Rombley, Inc., produces and sells two types of power lawn mowers—the basic mower and the self-propelled mower. Budgeted and actual data for the two models are shown below.

Budgeted Amounts:

Required:
1. Calculate the contribution margin variance.
2. What if actual units sold of the self-propelled mower increased? How would that affect the contribution margin variance? What if actual units sold of the selfpropelled mower decreased? How would that affect the contribution margin variance?LO1

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Basic Mower Self- Propelled Mower Total Sales: ($250 x 15,000) $3,750,000 ($300 x 45,000) Variable expenses Contribution margin 1,500,000 $2,250,000 $ 4,500,000 $13,500,000 9,000,000 $17,250,000 10,500,000 $ 6,750,000 Actual Amounts: Basic Self- Propelled Mower Mower Total Sales: ($238 x 14,800) $3,522,400 ($310 x 44,000) Variable expenses 1,628,000 Contribution margin $1,894,400 $ 5,720,000 $13,640,000 7,920,000 $17,162,400 9,548,000 $ 7,614,400