Contribution Margin Variance

Iliff, Inc., produces and sells two types of countertop ovensthe toaster oven and the convection oven. Budgeted and actual data for the two models are shown below.

Budgeted Amounts:

		Toaster Oven		Convection Oven		Total
Sales:
($92 25,500)		$2,346,000
($157 18,500)				$2,904,500		$5,250,500
Variable expenses		485,000		680,000		1,165,000
Contribution margin		$1,861,000		$2,224,500		$4,085,500

Actual Amounts:

		Toaster Oven		Convection Oven		Total
Sales:
($82 23,000)		$1,886,000
($165 13,000)				$2,145,000		$4,031,000
Variable expenses		530,800		703,400		1,234,200
Contribution margin		$1,355,200		$1,441,600		$2,796,800

Required:

1. Calculate the contribution margin variance.

_ (favorable or unfavorable)

2. What if actual units sold of the convection oven decreased? How would that affect the contribution margin variance? (it would become less unfavorable or more favorable, or it would become more unfavorable or less favorable?)

What if actual units sold of the convection oven increased? How would that affect the contribution margin variance? (it would become less unfavorable or more favorable, or it would become more unfavorable or less favorable?)