The Hiro Corporation sells two brands of wine glasses: Plain and Chic. Hiro provides the following information

Question:

The Hiro Corporation sells two brands of wine glasses: Plain and Chic. Hiro provides the following information for sales in the month of June 2017:

Static-budget total contribution margin.................................$15,525

Budgeted units to be sold of all glasses..............................2,300 units

Budgeted contribution margin per unit of Plain.....................$5 per unit

Budgeted contribution margin per unit of Chic.....................$12 per unit

Total sales-quantity variance.............................................$2,700 U

Actual sales-mix percentage of Plain..........................................60%

All variances are computed in contribution-margin terms.

Required:

1. Calculate the sales-quantity variances for each product for June 2017.

2. Calculate the individual-product and total sales-mix variances for June 2017. Calculate the individual product and total sales-volume variances for June 2017.

3. Briefly describe the conclusions you can draw from the variances.

Contribution Margin
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