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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
The Payne Company manufactures two types of vinyl flooring. Budgeted and actual operating data for 2012 are as follows:
| Â |
Static Budget |
Actual Results |
||||
| Â |
Commercial |
Residential |
Total |
Commercial |
Residential |
Total |
|
Unit sales in rolls |
20,000 |
60,000 |
80,000 |
25,200 |
58,800 |
84,000 |
|
Contribution margin |
$10,000,000 |
$24,000,000 |
$34,000,000 |
$11,970,000 |
$24,696,000 |
$36,666,000 |
In late 2011, a marketing research firm estimated industry volume for commercial and residential vinyl flooring for 2012 at 800,000 rolls. Actual industry volume for 2012 was 700,000 rolls.
1. Compute the sales-mix variance and the sales-quantity variance by type of vinylflooring and in total. (Compute all variances in terms of contribution margins.)
2. Compute the market-share variance and the market-size variance.
3. What insights do the variances calculated in requirements 1 and 2 provide about Payne Company’s performance in 2012?
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