Question Details

(Solved by Expert Tutors) ""Baucom Industries Inc. manufactures only one product. For the year end


contribution margin increased by 36,000from the planned level of 720,000. The president of Baucom Industries Inc. has expressed some concerns about such a small increase and has requested a follow-up report. The following data have been gathered from the accounting records for the year ended Dec 31, 2010. Sales: Actual: 1,470,000 Planned: 1,440,000 Difference-Increase (Decrease): 30,000 Less: Variable cost of goods sold: Actual 560,000 Planned 592,000 Difference-Increase (Decrease): (32,000) Variable selling and administrative expenses: Actual 154,000 Planned: 128,000 Difference-Increase (Decrease): 26,000 Total: Actual 714,000 Planned: 720,000 Difference-Increase (Decrease): (6,000) Contribution Margin Actual 756,000 Planned 720,000 Difference-Increase (Decrease): 36,000 Number of units sold: Actual 14,000 Planned 16,000 Per unit: Sales price: Actual 105.00 Planned 90.00 Variable cost of goods sold:Actual 40.00 Planned 37.00 Variable selling and administrative expenses: Actual 11.00 Planned 8.00 1. At a meeting of the board of directors on Jan 30, 2011, the president, after reviewing the contribution margin analysis report, made the following comment " It looks as if the price increase of 15.00 had the effect of decreasing sales volume. However, this was a favorable tradeoff. The variable cost of goods sold was less than planned. apparently we are efficiently mananging our variable cost of goods sold. however the variable selling and administrative expense appear out of control. lets look into these expenses and get them under control. Also lets consider increasing the sales price to 120 and continue this favorable tradeoff between higher price and lower volume. DO you agree with the presidents comment? Explain

 


Solution details:

Pay using PayPal (No PayPal account Required) or your credit card . All your purchases are securely protected by .
SiteLock

About this Question

STATUS

Answered

QUALITY

Approved

DATE ANSWERED

Apr 19, 2020

EXPERT

Tutor

ANSWER RATING

YES, THIS IS LEGAL

We have top-notch tutors who can do your essay/homework for you at a reasonable cost and then you can simply use that essay as a template to build your own arguments.

You can also use these solutions:

  • As a reference for in-depth understanding of the subject.
  • As a source of ideas / reasoning for your own research (if properly referenced)
  • For editing and paraphrasing (check your institution's definition of plagiarism and recommended paraphrase).
This we believe is a better way of understanding a problem and makes use of the efficiency of time of the student.

NEW ASSIGNMENT HELP?

Order New Solution. Quick Turnaround

Click on the button below in order to Order for a New, Original and High-Quality Essay Solutions. New orders are original solutions and precise to your writing instruction requirements. Place a New Order using the button below.

WE GUARANTEE, THAT YOUR PAPER WILL BE WRITTEN FROM SCRATCH AND WITHIN A DEADLINE.

Order Now