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Sergio [31]
4 years ago
10

Impact Window Company makes storm-resistant windows. The company's sales manager estimated the sales volume to be 160,000 window

s. Due to the increased hurricane activity this year, the total demand for this type of window increased from 800,000 windows to 1,000,000 windows. At the same time the company's market share fell from 20 percent to 15 percent. The company's standard contribution margin is $15.00 per window. What is the company's sales activity varian
Business
1 answer:
Sati [7]4 years ago
3 0

Answer:

$150,000 unfavorable variance

Explanation:

The budgeted sales volume for the year is 160,000 windows

However,the whole industry sales volume increased to 1,000,000 windows with the company managing to hold on to only 15% of total market sales of 1,000,000 i.e 150,000(1,000,000*15%)

sales activity sale=change in sales volume*standard contribution margin=(160,000-150,000*)$15=$150,000 unfavorable since actual sales were less than forecast sales

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