Question
Alex's Pizza is a budget take-away pizza shop in Sydney. Alex focuses on three high-demand pizzas and charges $12/pizza for all three, regardless of the
Alex's Pizza is a budget take-away pizza shop in Sydney. Alex focuses on three high-demand pizzas and charges $12/pizza for all three, regardless of the cost to produce them. The following tables sets out Alex's budget and actual results for sales in July 2021:
Budget for July 2021
Pizza Variable cost/ pizza sales volume
Ham & Pineapple $3 500
Pepperoni $4 600
BBQ chicken $5.80 450
Actual data for July 2021
Pizza Variable cost/ pizza sales volume
Ham & Pineapple $3.10 550
Pepperoni $4.05 610
BBQ chicken $6.20 425
Part a) Find thetotal sales-volume variance, total sales-mix variance and thetotal sales-quantity variancefor July 2021. (show working)
Part b) Explain to Alex what the variances indicate.
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