Next Year's Budget for Canfield, Inc At the End of the Year, the Total Fixed Costs

question 59

Essay

Next year's budget for Canfield, Inc., a multi-product company, is given below: $\begin{array}{lcc}&\text { Product A } & \text { Product B }\\\text { Sales }&\$1,890,000&\$1,377,000 \\\text { Variable costs } &919,800&594,000\\\text { Fixed costs }& \underline{500,000}& \underline{500,000}\\\text {Net income } & \underline{\$470,200}& \underline{\$283,000} \\\text {Units}&252,000&108,000\\\end{array}$


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. Canfield analyzes the effects its sales variances have on the profitability of the company.
$$\begin{array} { c c c } \text { Product Line } & \text { Units } & \text { Sales } \\\text { A } & 252,230 & \$ 1,848,579 \\\text { B } & 113,770& \$ 1,479,010\end{array}$$
Required:
(Be sure to indicate whether the variance is favorable or unfavorable.)
a. Compute the sales activity variance for each product.
b. Compute the sales mix variance for each product.
c. Compute the sales quantity variance for each product.

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Definitions:

Online Customer Experience

The total interactions and perceptions a customer has with a brand's online presence, including website navigation, online service, and digital communication.

Commercial Transactions

The act of buying, selling, or exchanging goods or services between businesses or entities.

Customization

The process of modifying products, services, or experiences to meet individual customer needs or preferences, often leading to increased satisfaction.

Consumer-Initiated

pertains to actions or transactions that are started by the consumer rather than the business, emphasizing the active role consumers play in the buying process.