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(Appendix 10C) Yukon Company expressed the total expenses (Y) component of its master budget for March with the cost formula Y=$100,000+$40X where X represents the
(Appendix 10C) Yukon Company expressed the total expenses (Y) component of its master budget for March with the cost formula Y=$100,000+$40X where X represents the expected number of units of its only product to be manufactured and sold. The budgeted average selling price per unit was $65 for budgeted sales volume 5,000 units based on an estimated industry volume of 50,000 units. Reported actual results for February were as follows: *Actual industry sales volume was 60,000 units. Required: a) Calculate the flexible budget variance and analyze it into sales price variance and cost/expense variance(s). b) Calculate the sales volume variance and analyze it into market-size (industry volume) variance and market-share variance. c) On the basis of your analysis in parts (a) and (b), would you recommend a bonus be paid to the sales manager? Why or why not
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