Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Sales Territory and Salesperson Profitability Analysis Havasu Off-Road Inc. manufactures and sells a variety of commercial vehicles in the Northeast and Southwest regions. There are

image text in transcribed

image text in transcribed

Sales Territory and Salesperson Profitability Analysis Havasu Off-Road Inc. manufactures and sells a variety of commercial vehicles in the Northeast and Southwest regions. There are two salespersons assigned to each territory. Higher commission rates go to the most experienced salespersons. The following sales statistics are available for each salesperson: Northeast Southwest Rene Steve Colleen Paul Average per unit: Sales price Variable cost of goods sold Commission rate Units sold Manufacturing margin ratio $12,000 ?14,900 8,800 18,000 $7,200 $8,940 $5,456 $10,080 8% 50 44% 13% 12% 40 38% 8% 40% 40% a. 1. Prepare a contribution margin by salesperson report. Calculate the contribution margin ratio for each salesperson. If required, round contribution margin ratio to one decimal place Havasu Off-Road Inc. Contribution Margin by Salesperson Rene Steve Colleen Paul Contribution margin ratio | |% | |% | % | |% a. 2. Interpret the report. Paul earns the contribution margin and has the ? contribution margin ratio. This is because he sells the units, has a commission rate, and sells a product mix with a manufacturing margin. Steve also sells products with average manufacturing margin but at a commission rate. Colleen has the ? contribution margin ratio among the four salespersons. Although Rene has a high variable cost of goods sold and also sells products

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions