The following data for Romero Products Inc. are available Difference- Increase o

Question

The following data for Romero Products Inc. are available Difference- Increase or (Decrease) For the Year Ended December 31 Actual Planned 2 Sales 8550,000.00 $8,405,000.00 145,000.00 3 Variable costs: $3,477000.00 $3,280,000.00 $197,000.00 20,00000 155,000.00) 42,000.00 $103,00000 Variable cost of goods sold 665,000.00 $4,142,000.00 $4,100,000.00 4,408,000.00 $4,305,000.00$ Variable selling and administrative expenses 6 Total variable costs 7Contribution margin 8 Number of units sold 9 Per unit: 38,000.00 41,000.00 $225.00 9150 1750 $205.00 80.00 20.00 Sales price Variable cost of goods sold 12 Variable selling and administrative expenses Prepare an analysis of the sales quantity and unit price factors. Refer to the lists of Labels and Amount Descniptions for the exact wording of the answer choices for text entries. Be sure to complete the statement heading. A colon(:) will automatically appear if it is required. For those boxes in which you must enter subtracted or negative numbers use a minus sign

Explanation / Answer

Answer:

ROMERO PRODUCTS INC

Contribution Margin Analysis—Sales

For the Year Ended December 31, 2017

Effect of change in sales:

Sales quantity factor (38,000 – 41,000) × $205

(615000)

Unit price factor ($225– $205) × 38,000

760000

Total effect of change in sales

145000

Working note

Sales actual

=85550000/225

=38000

Sales planned

=84050000/205

=41,000

ROMERO PRODUCTS INC

Contribution Margin Analysis—Sales

For the Year Ended December 31, 2017

Effect of change in sales:

Sales quantity factor (38,000 – 41,000) × $205

(615000)

Unit price factor ($225– $205) × 38,000

760000

Total effect of change in sales

145000

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