Problem 17-31 Sales Mix and Quantity Variances (LO 17-3) Compute the sales price
ID: 2800627 • Letter: P
Question
Problem 17-31 Sales Mix and Quantity Variances (LO 17-3)
Compute the sales price variance for all three wines. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)
Compute the activity variance for Mattie’s Vineyards for the year. (Indicate the effect of the variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Do not round your intermediate calculations. Round your answer to 2 decimal places.)
Compute the mix and quantity variances for Mattie’s Vineyards for the year. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Do not round your intermediate calculations. Round your answers to 2 decimal places.)
Mattie’s Vineyards is a producer and wholesaler of three varieties of white wine. Sales data for November are given below:Explanation / Answer
Sauvignon Chardonnay Riesling Total Blanc Budgeted selling price $ 7.45 $ 8.20 $ 7.20 Budgeted variable cost $ 5.30 $ 6.20 $ 5.20 Budgeted selling quantity 10800 4,050 12,150 27,000 Actual selling price $ 7.20 $ 8.35 $ 6.85 Actual variable cost $ 5.20 $ 6.10 $ 4.85 Actual selling quantity 9280 6,960 12,760 29,000 a) Sales Price Variance =(Actual Price-Standard Price)*Actual Qty $ 2,320 F $ 1,044 U $ 4,466 F b) Activity Variance Activity Variance Sauvignon Blanc Particulars Actual Flexible Master Variance(abs of actual and flex) F/U Qty sold 9280 9280 10800 Selling Price($) per unit 7.20 7.45 7.45 Sales($) 66816 69136 80460 2320 U Qty 9280 9280 10800 Variable cost($) per unit 5.20 5.30 5.30 Variable Cost($) 48256 49184 57240 928 F Contribution ($) 18560 19952 23220 1392 U Activity Variance Chardonnay Particulars Actual Flexible Master Variance(abs of actual and flex) F/U Qty sold 6960 6960 4050 Selling Price($) per unit 8.35 8.20 8.20 Sales($) 58116.00 57072.00 33210.00 1044.00 F Qty 6960 6960 4050 Variable cost($) per unit 6.10 6.20 6.20 Variable Cost($) 42456.00 43152.00 25110.00 696.00 F Contribution ($) 15660.00 13920.00 8100.00 1740.00 F Activity Variance Riesling Particulars Actual Flexible Master Variance(abs of actual and flex) F/U Qty sold 12760 12760 12150 Selling Price($) per unit 6.85 7.20 7.20 Sales($) 87406.00 91872.00 87480.00 4466.00 U Qty 12760 12760 12150 Variable cost($) per unit 4.85 5.20 5.20 Variable Cost($) 61886.00 66352.00 63180.00 4466.00 F Contribution ($) 25520.00 25520.00 24300.00 0.00 None Sauvignon Chardonnay Riesling Total Blanc c) Sales Qty Variance =(Actual Qty-Standard Qty)*Standard Price $ 11,324.00 U $ 23,862.00 F $ 4,392.00 F Mix Variance=(Qty Variance+Price Variance) Sales Qty Variance $ 11,324.00 U $ 23,862.00 F $ 4,392.00 F Sales price variance $ 2,320.00 F $ 1,044.00 U $ 4,466.00 F Mix Variance $ 9004.00 U $ 22,818.00 F $ 8,858.00 F