The next year's budget for Benny, Inc., is given below:
Product 1-2
Sales $945,000-688500
Variable costs 459,900-297,000
Fixed costs 300,000-300,000
Net income $185,100-$91,500
Units 126,000-54,000
Market share 12%-20.0%
At the end of the year, the total fixed costs and the variable costs per unit were exactly as budgeted, but the following units per product line were sold:
Product Line- Units- Sales- Mkt share
1- 126,200- $958,579- 16.0%
2- 56,800- $721,010- 14.2%
Required: (Be sure to indicate whether the variance is favorable or unfavorable.)
a. Compute the sales activity variance for each product.
b. Compute the market share variance for each product.
c. Compute the industry volume variance for each product