Question: The Penguins play in the North American Ice Hockey League

The Penguins play in the North American Ice Hockey League. The Penguins play in the Downtown Arena (owned and managed by the City of Downtown), which has a capacity of 15,000 seats (5,000 lower-tier seats and10,000 upper-tier seats). The Downtown Arena charges the Penguins a per-ticket charge for use of the facility. All tickets are sold by the Reservation Network, which charges the Penguins a reservation fee per ticket. The Penguins’ budgeted contribution margin for each type of ticket in 2013 is computed as follows:
The budgeted and actual average attendance figures per game in the 2013 season are:
There was no difference between the budgeted and actual contribution margin for lower-tier or upper-tier seats.
The manager of the Penguins was delighted that actual attendance was 10% above budgeted attendance per game, especially given the depressed state of the local economy in the past six months.
REQUIRED
1. Compute the sales-volume variance for each type of ticket and in total for the Penguins in
2013. (Calculate all variances in terms of contribution margins.)
2. Compute the sales-quantity and sales-mix variances for each type of ticket and in total in 2013.
3. Present a summary of the variances in requirements 1 and 2. Comment on the results.


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  • CreatedJuly 31, 2015
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