The Chair Company manufactures two modular types of chairs: one for the residential market, and the other for the office market. Budgeted and actual operating data for the year 2012 are:
Required:
Compute the following variances in terms of contribution margin:
a. Compute the total static-budget variance, the total flexible-budget variance, and the total sales-volume variance.
b. Compute the sale-mix variance and the sales-quantity variance by type of chair, and in total.
Definitions:
Fitness For A Particular Purpose
A guarantee that a product will meet the specific requirements or needs of the buyer, as acknowledged by the seller.
Seller Or Lessor
The party in a transaction who is selling or leasing a good, service, or property to another party, known as the buyer or lessee.
Breach
The act of breaking or failing to observe a law, agreement, or code of conduct.
Damages
Compensation claimed by a party in a lawsuit for losses or injuries suffered as a result of another party's actions or failure to act.
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