Best Company, Inc
Essay by scox • September 18, 2015 • Exam • 1,008 Words (5 Pages) • 1,149 Views
CASE STUDY #3
BEST COMPANY, INC
JUNE 30, 2015
SUMMARY OF CONTRIBUTION MARGIN VARIANCES
June 2015 | Current Month | Price Variance | Flexible | Budget | Qty Variance | Net Variance |
. | # of pieces |
|
| # of pieces |
|
|
# of units | 76,840.00 | - | 76,840.00 | 68,195.00 | 8,645.00 | |
Average SP per unit | $ 90.15 | $ (0.78) | $ 90.93 | $ 90.93 | ||
Average VC per unit | $ 61.03 | $ (1.20) | $ 59.83 | $ 59.83 | ||
Change in SP vs. VC | $ 29.12 | $ (1.99) | $ 31.10 | $ 31.10 | $ 31.10 |
|
Variance | $ (152,578.78) | $ 268,890.53 | $ 116,311.75 | |||
Actual | Price Variance | Flexible | Budget | Qty Variance | Net Variance | |
Net Sales | $ 6,927,282.05 | $ (60,097.18) | $ 6,987,379.23 | $ 6,201,253.60 | $ 786,125.63 | $ 726,028.45 |
Variable Costs | $ 4,689,861.00 | $ (92,481.60) | $ 4,597,379.40 | $ 4,080,144.30 | $ (517,235.10) | $ (609,716.70) |
Contribution Margin | $ 2,237,421.05 | $ (152,578.78) | $ 2,389,999.83 | $ 2,121,109.30 | $ 268,890.53 | $ 116,311.75 |
Contribution Margin % | 32.30% | -1.91% | 34.20% | 34.20% | 0.00% | -1.91% |
You are the Controller of Best Company, Inc. and your Senior Cost Accountant has prepared a brief summary of the June 2015 month end contribution margin and variance analysis for your monthly reporting.
Best Company manufactures furniture and has two factories located in Greensboro, SC and Lexington, KY. It has over 250 employees and sells to major retailers such as Bob’s Discount Furniture, Boscov’s (PA) and Jordan’s (MA)
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