Question

Santa Toy Shop produces toys. During November, the following information was gathered:

	Dart Board	Lego Sets	Dolls	Breyer Horses	Golf Sets	Stuffed Toys
Budgeted units sold	175	500	400	125	600	300
Actual units sold	200	400	250	140	500	350
Budgeted selling price	$5	$30	$11	$40	$80	$18
Actual selling price	$8	$25	$12	$45	$75	$28
Budgeted variable cost	$2	$18	$5	$20	$35	$10
Actual variable cost	$3	$15	$4	$25	$30	$11

Actual market size was 20,000, whereas budgeted market share was 16%.

REQUIRED:

1. Compute the total, sales price, variable cost, flexible-budget, sales-volume, sales-mix, sales-quantity, market-share, and market-size variances. Be sure to indicate whether each is favorable or unfavorable!
2. Calculate numbers to three to four decimal points!

Answer 1

TOTAL SALES PRICE VARIANCE

		Dart board	Lego sets	Dolls	Breyer Horses	Golf sets	Stuffed toys	Total
A	Actual Selling Price $	8	25	12	45	75	28
B	Budgeted Selling price $	5	30	11	40	80	18
C	Actual units sold	200	400	250	140	500	350
	Sales price variance	$600	($2,000)	$250	$700	($2,500)	$3,500	$550
	(A - B)*C	Favorable	Unfavorable	Favorable	Favorable	Unfavorable	Favorable	Favorable

TOTAL VARIABLE COST VARIANCE

		Dart board	Lego sets	Dolls	Breyer Horses	Golf sets	Stuffed toys	Total
A	Budgeted Units sold	175	500	400	125	600	300
B	Budgeted variable Cost $	2	18	5	20	35	10
C	Total Budgeted variable cost (A*B)	350	9,000	2,000	2,500	21,000	3,000	37,850
D	Actual units sold	200	400	250	140	500	350
E	Actual Variable cost $	3	15	4	25	30	11
F	Total Actual variable cost (D*E)	600	6,000	1,000	3,500	15,000	3,850	29,950
	Total variable cost variance	($250)	($3,000)	$1,000	($1,000)	$6,000	($850)	$1,900
	(C - F)	Unfavorable	Unfavorable	Favorable	Unfavorable	Favorable	Unfavorable	Favorable

Total Sales volume variance

		Dart board	Lego sets	Dolls	Breyer Horses	Golf sets	Stuffed toys	Total
A	Budgeted Units sold	175	500	400	125	600	300
B	Actual units sold	200	400	250	140	500	350
C	Budgeted Selling price	5	30	11	40	80	18
	Total Sales volume variance	$125	($1,000)	$1,650	($600)	$8,000	($900)	$7,275
	(B - A)*C	Favorable	Unfavorable	Favorable	Unfavorable	Favorable	Unfavorable	Favorable

Ratio in which budgeted units sold are = 175:500:400:125:600:300

Total budgeted units sold = 2,100 units

Actual units sold = 1,840 units

Total Sales mix variance

		Dart board	Lego sets	Dolls	Breyer Horses	Golf sets	Stuffed toys	Total
A	Actual units sold	200	400	250	140	500	350
B	Actual units in standard sales mix	153	438	350	110	526	263
		(1,840/2,100)*175	(1,840/2,100)*500	(1,840/2,100)*400	(1,840/2,100)*125	(1,840/2,100)*600	(1,840/2,100)*300
C	Budgeted Selling price $	5	30	11	40	80	18
D	Budgeted variable Cost $	2	18	5	20	35	10
E	Budgeted Contribution (C-D)	3	12	6	20	45	8
	Total Sales mix variance	$141	($456)	($600)	$600	($1,170)	$696	$789
	(A - B)*E	Favorable	Unfavorable	Unfavorable	Favorable	Unfavorable	favorable	Unfavorable

Total Sales quantity variance

		Dart board	Lego sets	Dolls	Breyer Horses	Golf sets	Stuffed toys	Total
A	Budgeted Units sold	175	500	400	125	600	300
B	Actual units in standard sales mix	153	438	350	110	526	263
		(1,840/2,100)*175	(1,840/2,100)*500	(1,840/2,100)*400	(1,840/2,100)*125	(1,840/2,100)*600	(1,840/2,100)*300
C	Budgeted Selling price $	5	30	11	40	80	18
D	Budgeted variable Cost $	2	18	5	20	35	10
E	Budgeted Contribution (C-D)	3	12	6	20	45	8
	Total Sales quantity variance	$66	$744	$300	$300	$3,330	$296	$5,036
	(A - B)*E	Unfavorable	Unfavorable	Unfavorable	Unfavorable	Unfavorable	Unfavorable	Unfavorable