Problem 17-47 Derive Amounts for Profit Variance Analysis (LO 17-5)

Classics, Ltd., details cars. Classics wants to compare this quarters results with those for last quarter, which is believed to be typical for operations. Assume that the following information is provided:

	Last Quarter				This Quarter
Number of detailings		440				523
Revenues	$	69,040			$	68,800
Variable costs		27,920				31,920
Contribution margin	$	41,120			$	36,880

Required:

Compute the flexible budget and sales activity variance and prepare a profit variance analysis. (Hint: Use last quarter as the master budget and this quarter as actual.) (Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.)

	Actual	Variable Cost Variance		Sales Price Variance		Flexible Budget	Sales Activity Variance		Master Budget
Sales revenue
Less:
Variable Costs
Contribution margin

What impact did the changes in number of detailings and average revenues (i.e., sales price) have on Classics, Ltd.s contribution margin? (Do not round intermediate calculations.)

Contribution margin