The following data represent the flexible budget for Mountain Mist Brewery, a boutique brewery that manufactures and sells boutique ales.

Note that, overall, the increase in the final price of beer has contributed to the flattening of the Australian beer market. The budgeted market for beer sales in Australia was 1736 megalitres, but the actual market was 1730 megalitres.

Required

(a) Briefly explain the meaning of the $3.03 million contribution margin variance.

(b) Calculate the market share and market size variances for Mountain Mist Brewery.

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Flexible Static budget Variance budget Actual Variance Volume Volume (megalitres) $million $million $million (megalitres) $million $million $7.93 F Sales 52.00 132.17 138.75 54.60 140.10 Cost of sales 28.45 72.32 75.87 29.87 74.25 $1.93U Contribution margin 59.85 3.03 62.88 65.85 $6.00 F Other costs 9.01 9.28 $0.27 U Selling and administration costs 15.16 15.58 $0.42 U EBIT 35.68 40.99 $5.31 F