Using the enclosed performance results, please provide an EBITDA variance walk from 2016 to 2017. Specifically highlight the impacts of pricing, COGS, and volume. Assume the company only produces what it sells. Please provide your results

Using the enclosed preformance results for WidgetCo, please provide an EBITDA variance walk from 2016 to 2017. Specifically highlight the impacts of pricing, COGS and volume. Assume WidgetCo only produces what it sells. Please provide your results on a single page, formatted for printing. WidgetCO LLC 2016 Units Sold Customer 1 Customer 2 2017 750 250 1,000 800 300 1,100 50 50 100 Rev / Unit Customer 1 Customer 2 $ $ 100 100 $ $ 110 100 $ $ 10 - Cost / Unit $ 75 $ 70 $ (5) Customer 2016 Quantity 1 2 750 250 1,000 Total 2016 Quantity 1000 2016 Selling price 100 100 2016 Total sales Revenue 75,000 25,000 100,000 2017 Quantity 2016 Cost 2016 Total Cost 75,000 2017 Quantity 1,100 75 800 300 1,100 2017 Selling price 110 100 2017 Total sales Revenue 88,000 30,000 118,000 2017 Cost 2017 Total Cost 77,000 70 EBTDA variance = (2016 profit - 2017 profit) 2016 profit = Sales - costs = 100,000-75,000 = 25,000 2017 profit = Sales - costs = 118,000-77,000 = 41,000 EBTDA variance = (25,000- 41,000) = 16,000 F Explanation a. Sales price variance Sales price variance = (2016 selling price - 2017 selling price)* 2017 units sold Customer 1: ($100-$110)*800 = $8,000 F 2: ($100-$100)*300 = $0 $8,000F b. Sales volume variance Sales volume variance = (2016 units sold - 2017 units sold)*2016 profit per unit Customer 1: (750 - 800)*$25 = $1,250 F 2: (250-300)*$25 = $1,250 F $2,500F c. Overall cost variance Cost variance = (2016 cost -2017 cost)* 2017 units sold Customer 1: (75 - 70)*800 = $4,000 F 2: (75-70)*300 = $1,500 F $5,500F Statement of reconciliation of 2017 profit with Budgeted profit 2016 profit Add Favorable variances: Sales Price variance Sales volume variance Cost variance (overall) 2017 profit $25,000 $8,000 2,500 5,500 $16,000 $41,000 Customer 2016 Quantity 1 2 750 250 1,000 Total 2016 Quantity 1000 2016 Selling price 100 100 2016 Total sales Revenue 75,000 25,000 100,000 2017 Quantity 2016 Cost 2016 Total Cost 75,000 2017 Quantity 1,100 75 800 300 1,100 2017 Selling price 110 100 2017 Total sales Revenue 88,000 30,000 118,000 2017 Cost 2017 Total Cost 77,000 70 EBTDA variance = (2016 profit - 2017 profit) 2016 profit = Sales - costs = 100,000-75,000 = 25,000 2017 profit = Sales - costs = 118,000-77,000 = 41,000 EBTDA variance = (25,000- 41,000) = 16,000 F Explanation a. Sales price variance Sales price variance = (2016 selling price - 2017 selling price)* 2017 units sold Customer 1: ($100-$110)*800 = $8,000 F 2: ($100-$100)*300 = $0 $8,000F b. Sales volume variance Sales volume variance = (2016 units sold - 2017 units sold)*2016 profit per unit Customer 1: (750 - 800)*$25 = $1,250 F 2: (250-300)*$25 = $1,250 F $2,500F c. Overall cost variance Cost variance = (2016 cost -2017 cost)* 2017 units sold Customer 1: (75 - 70)*800 = $4,000 F 2: (75-70)*300 = $1,500 F $5,500F Statement of reconciliation of 2017 profit with Budgeted profit 2016 profit Add Favorable variances: Sales Price variance Sales volume variance Cost variance (overall) 2017 profit $25,000 $8,000 2,500 5,500 $16,000 $41,000