The following data for Gardot Products Inc. are available: Prepare an analysis o

Question

The following data for Gardot Products Inc. are available:

Prepare an analysis of the sales quantity and unit price factors.

For the Year Ended December 31

Actual

Planned Difference—Increase or (Decrease) Sales $1,684,800 $1,652,400 $32,400 Less: Variable cost of goods sold $889,200 $874,800 $14,400 Variable selling and administrative expenses 171,600 178,200 -6,600 Total variable costs $1,060,800 $1,053,000 $7,800 Contribution margin $624,000 $599,400 $24,600 Number of units sold 15,600 16,200 Per unit: Sales price $108 $102 Variable cost of goods sold 57 54 Variable selling and administrative expenses 11 11

Explanation / Answer

Gardot Products Inc. Statement Showing Analysis Particulars Description Amount ($) Effect of changes in sales: Sales quantity factor $93,600.00 Unit Price factor -$61,200.00 Total effect of change in sales $32,400.00 Working Note: Actual Planned Difference Sales $1,684,800.00 $1,652,400.00 $32,400.00 Sales Price $108 $102 $6 Sales Qty ( Sales/Sales Price)               15,600               16,200                   600 Sales Quantity Factor Decrease in Unit ( 15600-16200) -600 Planned Sales Price $102 Effect due to Sales Quantity Factor (600*102) ($61,200) Unit Price Factor Increase in Sales Price ($108-$102) $6 Actual Sales Quantity $15,600 Effect due to Increase in Unit Price Factor( $6*15600) $93,600

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