The Sato Corporation $($SC$)$ sells two brands of wine glasses: Plain and Chic. SC provides the following information for sales in the month of June:

$($Click the icon to view the information for sales.$)$

All variances are to be computed in contribution$-$margin terms.

Required

Calculate the sales$-$quantity variances for each product for June.

Calculate the individual$-$product and total sales$-$mix variances for June. Calculate the individual$-$product and total sales$-$volume variances for June.

Briefly describe the conclusions you can draw from the variances.

Sales information

Static$-$budget total contribution margin

$$9,240$

Budgeted units to be sold of all glasses

$2,100$ units

Budgeted contribution margin per unit of Plain

$$3$ per unit

Budgeted contribution margin per unit of Chic

$$10$ per unit

Total sales$-$quantity variance

$$3,520U$

Actual sales$-$mix percentage of Plain

$60\%$

Print

Requirement $1.$ Calculate the sales$-$quantity variances for each product for June.

Begin by determining the basic formula for Sato Corporation's static$-$budget total contribution margin $($CM$).$

$\backslash$table$[[$Plain wine glasses,Chic wine glasses,$\backslash$table$[[$Static$-],[$budget$]]],[$Budgeted$,$Budgeted,Budgeted,Budgeted,Budgeted,Budgeted$],[,,,,,,$total$],[,,x,,x,x,$CM$]]$

Rearrange the formula to determine the sales mix for each product.

The sales$-$mix percentage of Plain wine glasses is $q,\%.$

The sales$-$mix percentage of Chic wine glasses is $\%.$

Next, determine the formula and compute the budgeted CM based on actual units sold of all products at the budgeted mix.

$$

The actual number of all glasses sold is units.

Now, determine the formula, and then calculate the sales$-$quantity variances for each product for June. Label each variance as favourable $($F$)$ or unfavourable $($U$).($Enter percentages, if any, as decimals rounded to two places, $"$X$.$XX$".)$

Requirement $2.$ Calculate the individual$-$product and total sales$-$mix variances for June. Calculate the individual$-$product and total sales$-$volume variances for June.

Begin with the individual$-$product sales$-$mix variances for June. Determine the formula, and then calculate the variance for each product. Label each variance as favourable $($F$)$ or unfavourable $($U$).($Enter percentages, if any, as decimals rounded to two places, $"$X$.$XX$".)$

The total sales$-$mix variance is

Now, calculate the individual$-$product sales$-$volume variances for June. Determine the formula, and then calculate the variance for each product. Label each variance as favourable $(F)$ or unfavourable $($U$).$

The total sales$-$volume variance is

Requirement $3.$ Briefly describe the conclusions you can draw from the variances.

Sato Corporation shows a$($n$)]$ sales$-$quantity variance because it sold

$$ wine glasses in total than was budgeted. This is partially offset by $a(n)$ sales$-$mix variance because the actual mix of wine glasses sold has shifted in favour of the higher$-$contribution$-$margin wine glasses.