Question
Luna Corp has two products named A and B. The firm had the following master budget for the year just completed: Product A Product B
Luna Corp has two products named A and B. The firm had the following master budget for the year just completed:
Product A | Product B | |
Sales | $300,000 | $450,000 |
Variable Costs | $150,000 | $180,000 |
Fixed Costs | $50,000 | $60,000 |
Operating Income | $100,000 | $210,000 |
CM per unit | $15 | $30 |
Units | 10,000 | 9,000 |
The following operating results were reported after the year was over:
Product A | Product B | |
Sales | $320,000 | $460,000 |
Variable Costs | $160,000 | $200,000 |
Fixed Costs | $50,000 | $60,000 |
Operating Income | $110,000 | $200,000 |
CM per unit | $14.55 | $28.89 |
Units | 11,000 | 9,000 |
The total market was estimated to be 50,000 units at the time of budget. The actual total market for the year is 65,000 units. The sales mix variance for Product A is:
$7,105U $6,750F $7,105F $14,211U $14,211F
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