Contribution Margin Analysis. Ross Distributing sells two items, Cheap and Expensive. Joe Ross is pleased that the June contribution margin is above budget, but he believes something strange happened as he sold less and made more money. The data are as follows:

\section*{Required:}
1. Prepare an analysis of revenues, variable costs, and contribution margin.
2. Explain to Joe how he could sell less and make more.

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Budgeted Results Actual Results Cheap Expensive Total Cheap Expensive Total 240,000 120,000 360,000 250,000 100,000 350,000 $ 2,160,000 $4,560,000 $2,750,000 $1,800,000 $4,550,000 930,000 $1,230,000 2,130,000 1,350,000 750,000 2,100,000 $2,430,000 $1,400,000 $1,050,000 $2,450,000 Sales units.. Revenues.. Variable costs Contribution margin $2,400,000 1,200,000 $ 1,200,000