Danner Fashions Sells a Line of Women's Dresses -
What Additional Information Is Needed for Danner to Calculate

question 34

Multiple Choice

Danner Fashions sells a line of women's dresses. Danner's performance report for November is shown below: (CMA adapted)
The company uses a flexible budget to analyze its performance and to measure the effect on operating income of the various factors affecting the difference between budgeted and actual operating income. $\begin{array}{lcccc}&&\text { Actual}&&\text { Budget }\\ \text { Dresses sold } & & \underline{ 5,000} & & \underline{ 6,000 }\\ \text { Sales } & \$ & 235,000 & \$ & 300,00 \\ \text { Variable costs } & & \underline{(145,000) }& & \underline{(180,000) }\\ \text { Contribution margin } & & \$90,000 & & 120,000 \\\text { Fixed Costs } & & \underline{ (84,000) } & & \underline{ (80,000) } \\ \text { Operating income } &\$& \underline{ \underline{ 6,000 }}&\$& \underline{ \underline{ \$ 40,000}} \\ \end{array}$
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What additional information is needed for Danner to calculate the dollar impact of a change in market share on operating income for November? (CMA adapted)

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Definitions:

Anthony Giddens

A contemporary sociologist known for his theory of structuration, which seeks to explain the dynamic relationship between individuals and society.

Ulrich Beck

A German sociologist best known for his theory of "risk society," highlighting the ways modern society deals with risks and uncertainties.

Zygmunt Bauman

A sociologist known for his analyses of modernity, postmodernity, and the societal impacts of globalization, consumerism, and ethics.

Eastern

Referring to the regions, cultures, or characteristics of the East, often in context of geography, like Asia, or in comparison to the Western world.