Computer Horizons manufactures and sells three related microcomputer products:

1.Plum - sold mostly to college students

2.Portable Plum - smaller version of the Plum that can be carried in a briefcase

3.Super Plum - has a larger memory and more capabilities than the Plum and targeted at the business market.

Budgeted and actual operating data for 2018 follow:

BUDGET for 2018

Selling PriceVariable costsContributionSales Volume

per unitper unitmargin per unitin units

Plum$1,200$700$500700,000

Portable Plum800500300100,000

Super Plum5,000 3,0002,000200,000

1,000,000

ACTUAL for 2018

Selling PriceVariable costsContributionSales Volume

per unitper unitmargin per unitin units

Plum$1,100$500$600825,000

Portable Plum650 400250165,000

Super Plum3,500 2,5001,000110,000

1,100,000

During 2018, competition sparked by overseas suppliers drove the cost of computer chips down, allowing Computer Horizons to buy key components at bargain prices. Computer Horizons had budgeted for a major expansion into the lucrative microcomputer business market in 2018. Unfortunately, it underestimated the marketing power of its rival, the Big Blue Company.

Computer Horizons derived its total unit sales budget for 2018 and its market share from an internal management estimate and an industry sales forecast by Micro-Information Services of 5,000,000 units. At the end of 2018, Micro-Informative Services reported actual industry sales of 6,875,000 units.

Required

1.Compute individual product sales mix, sales quantity and sales volume variances as well as total market share and market size variances for Computer Horizons in 2018.

2.Comment on the results in requirement 1.