Original

Budget
Budgeted Mkt
Size
11440000
Budgeted Mkt
Share
5720000
Budgeted Mkt Share (%)
Sales
VC
TFC
Profit

0.5
9219900
6628600 0.718945
1945900
645400
1

Budgeted fr Increased Demand

expected Actual Actual Mkt size
mkt share expected expected Increase in mkt Size
sales mix expected expected
Sales
VC
Profit
Budget for Actual Mkt
Share
Act
Act Mkt
Mkt Share
Size
Act Mtk Share (%)

TFC

Sales
VC
TFC
Profit

mkt size
12180000
0.065

costs
expected
9819193.5
7059459
813834.5
Diff due to Increased
Demand

expected

16843
4.5

12180000
5968366
0.49

1945900

9622809.63
6918269.82
1945900
758639.81

Diff dut ot Mkt Share

55194

Revised Budget for

Actual
Sales
VC
TFC
Profit

(Giv
en)
9645300
6936300
1945900
763100

Diff due to Sales Mix

4460.
19

2
Actual
Actual Actual
Actual expected
Actual
expected Actual

Mkt Size Var

F

Mkt Share Var

U

Sales mix Var

F

3
Actual
Actual
Actual
expected

BUDGETED PLAN 1973

BUDGETED PLAN 1973

0.42
0.35
0.01
0.05
0.04
0.11
0.03

vanilla
Chocolate
Walnut
Buttercrunch
Cherry Swirl
Strawberry
Pecan Ship
TOTAl

Standard
Contr.
Margin/Gall
0.4329
0.4535
0.5713
0.4771
0.5153
0.4683
0.5359
0.4530

Forecasted
gallon
Sa2,409,8
54
2,009,0
61 48,8
83
262,1
85
204,7
74
628,5
60
157,0
12
5,720,3
29

Forecasted
Standard
Cont.
1,043,2
Margin
26911,1
09
27,9
27
125,0
88
105,5
20
294,3
55
84,1
43
2,591,3
68
1.00

Budgeted Total expenses - Breakdown

Manufacturin
g
Delivery
Advertising
Selling
Administrativ
e
TOTAL

Variable
Cost 5,888,1
00187,3
00
553,2
00
6,628,6
00

Fixed Cost
612,8
00
516,3
00
368,8
00
448,0
00
1,945,9
00

To
tal 6,500,9
00703,6
00
553,2
00
368,8
00
448,0
00
8,574,5
00
1.03
0.03
0.10

Sales
Variable

9,219,9
00
6,628,6

BUDGETED PLAN 1973

Cost
Contribution
Margin Fixed
Cost

2,591,3
00
1,945,9
645,4
00
1.6118 Standard Cost

Var Manuf Cost/ gallon

Var Del cost / gallon
Var Adver Cost/ Gallon

REVISED BUDGETED FOR ACTUAL VOLUME 1973

vanilla
Chocolate
Walnut
Buttercrunch
Cherry Swirl
Strawberry
Pecan Ship
TOTAl

Standard
Contr.
Margin/Gall
0.4329
0.4535
0.5713
0.4771
0.5153
0.4683
0.5359
0.4539

Forecasted
gallon
Sa2,458,2
12
2,018,5
25 50,1
24
268,8
39
261,2
40
747,0
49
164,3
77
5,968,3
66

Forecasted
Standard
Cont.
1,064,1
Margin
60915,4
01
28,6
36
128,2
63
134,6
17
349,8
43
88,0
90
2,709,0
10

Budgeted Total expenses - Breakdown

Manufacturing
Delivery
Advertising
Selling
Administrative
TOTAL

Variable
Cost 6,113,1
00244,5
00
578,7
00
6,936,3
00
Sales
Variable
Cost
Contribution
Margin Fixed
Cost

Fixed Cost
612,8
00
516,3
00
368,8
00
448,0
00
1,945,9
00

To
tal 6,725,9
00760,8
00
578,7
00
368,8
00
448,0
00
8,882,2
00

9,645,3
00
6,936,3
2,709,0
00
1,945,9
763,1
00
1.6161 Price Charged

Per Gallon is Higher than Budgeted standard cost

vanilla
Chocolate
Walnut
Buttercrunch
Cherry Swirl
Strawberry
Pecan Ship
TOTAl

Standard
Contr.
Margin/Gall
0.4329
0.4535
0.5713
0.4771
0.5153
0.4683
0.5359
0.4539

Forecasted
gallon
Sa2,458,2
12
2,018,5
25 50,1
24
268,8
39
261,2
40
747,0
49
164,3
77
5,968,3
66

Forecasted
Standard
Cont.
1,064,1
Margin
60915,4
01
28,6
36
128,2
63
134,6
17
349,8
43
88,0
90
2,709,0
10

Budgeted Total expenses - Breakdown

Manufacturin
g
Delivery
Advertising
Selling
Administrativ
e
TOTAL

Variable
Cost 6,143,4
12195,4
21
577,1
87
6,916,0
20

Fixed Cost
612,8
00
516,3
00
368,8
00
448,0
00
1,945,9
00

To
tal 6,756,2
12711,7
21
577,1
87
368,8
00
448,0
00
8,861,9
20
1.03
0.03
0.10

Sales
Variable
Cost
Contribution
Margin Fixed
Cost

9,619,6
81
6,916,0
2,703,6
60
1,945,9
757,7
60
1.6118 Standard cost f

Here the standard Costs derived from the budgeted sales and budgeted volume are used
on the Ac

Var Manuf Cost/ gallon

Var Del cost / gallon
Var Adver Cost/ Gallon

rom Budgeted Volume and sales

tual volume to arrive at the variable cost and the sales amount.

Sales Net
Manufacturing Cost
Delivery
Advertising
Selling
Administrative
Total Expenses
Income from Operations

Sales Net
Manufacturing Cost
Delivery
Advertising
Selling
Administrative
Total Expenses
Income from
Operations

Act
ual9,657,3
00
6,824,9
00706,8
00
607,7
00
362,8
00
438,0
00
8,940,2
00
717,1
00

Act
ual9,619,6
81
6,824,9
00706,8
00
607,7
00
362,8
00
438,0
00
8,940,2
00
679,4
81

Budgeted for
Actual 9,645,3
00
6,725,9
00760,8
00
578,7
00
368,8
00
448,0
00
8,882,2
00
763,1
00

Budgeted for
Actual 9,645,3
00
6,725,9
00760,8
00
578,7
00
368,8
00
448,0
00
8,882,2
00
763,1
00

Varianc
e 12,0
00
99,0
-00
54,00
29,0
00
- 6,00
10,00
58,0
00
46,00

Varianc
e 25,61
99,00
54,0
-00
29,00
6,0
00
10,0
-00
58,00
83,61

EARNING STATEMENT REVISITED.

Actual Volume at the

standard price considered for the actual sales.

Sales Mix and Volume variance

Product
vanilla
Chocolate
Walnut
Buttercrunch
Cherry Swirl
Strawberry
Pecan Ship
TOTAL

Budgeted
Volume
1
2,409,8
54
2,009,0
61
48,883

Actual
Volume
2
2,458,2
12
2,018,5
25
50,124

262,1
85
204,7
74
628,5
60
157,0
12
5,720,3
29

268,8
39
261,2
40
747,0
49
164,3
77
5,968,3
66

Difference
3=
2-1 48,358
9,464
1,241
6,654
56,466
118,4
89
7,365
248,0
37

Mix Variance
Product

Budgeted
Proportion

vanilla
Chocolate
Walnut
Buttercrunch
Cherry Swirl
Strawberry
Pecan Ship
TOTAL

0.
42
0.
35
0.
01
0.
05
0.
04
0.
11
0.
03
1.
0

Budgeted
Mix at
actual1
2,514,3
47
2,096,1
75
51,003
273,5
54
213,6
53
655,8
15
163,8
20
5,968,3
66

Actual Sales
2
2,458,2
12
2,018,5
25
50,124
268,8
39
261,2
40
747,0
49
164,3
77
5,968,3
66

Sales Volume Variance

Product
vanilla
Chocolate
Walnut
Buttercrunch
Cherry Swirl
Strawberry
Pecan Ship
TOTAL

Budgeted
Proportion
0.
42
0.
35
0.
01
0.
05
0.
04
0.
11
0.
03
1.
0

Budgeted
Mix at
actual1
2,514,3
47
2,096,1
75
51,003

Budgeted
Volume
2
2,409,8
54
2,009,0
61
48,883

273,5
54
213,6
53
655,8
15
163,8
20
5,968,3
66

262,1
85
204,7
74
628,5
60
157,0
12
5,720,3
29

VARIANCE FROM OPERATIONS

Budgeted
Expense at
Actual

Act
ual

Manufacturing
Delivery
Advertising
Selling
Administrative
TOTAL

6,756,2
12711,7
21
577,1
87
368,8
00
448,0
00
8,861,9
20

6,824,9
00706,8
00
607,7
00
362,8
00
438,0
00
8,940,2
00

68,68
4,921
30,51
6,000
10,000
78,28

Total Variance
Variance Due to Sales
Volume
Mix
Prices
Variance Due to Operations
Manufacturing
Delivery
Advertising
Selling
Administration

112,3
63
5,279
12,000

129,6
42

68,68
4,921
30,51
6,000
10,000

Net variance

78,2
51,3
62

So here we see that though the total variance is positive it is just because of the increased sal

Second case is that if there was only the volume increase and no increase in the price then th
TOTAL VARIANCE
Variance Due to Sales
Volume
Mix
Prices
Variance Due to Operations
Manufacturing
Delivery
Advertising
Selling
Administration
Net variance

Budgeted Sales Volume and Market Share

112,3
63
5,279
25,61
68,68
4,921
30,51
6,000
10,000

92,0
23

78,2
13,7
43

Estimated Industry volume

Budgeted Volume (Units)

11,440,0
00
5,720,3
29

Budgeted Volume (%)

50.00%

Actual Sales Volume and Market Share

Actual Industry Volume
Actual Sales Volume (unit)

12,180,0
00
5,968,3
66

Actual Share in (%)

49.00%

Variance Due to Market Share

Product

Budgeted
Proportion

Actual Sales
1

vanilla
Chocolate
Walnut
Buttercrunch
Cherry Swirl
Strawberry
Pecan Ship
TOTAL

0.
42
0.
35
0.
01
0.
05
0.
04
0.
11
0.
03
1.
0

Actual Sales (Unit)

Budget share at Actual industry Volume
Difference
Budgeted Unit Contribution
Variance due to market share

2,514,3
47
2,096,1
75
51,003
273,5
54
213,6
53
655,8
15
163,8
20
5,968,3
66

Budgeted
Share of sales
at actual
industry
2
2,565,7
36
2,139,0
18
52,045
279,1
45
218,0
20
669,2
19
167,1
68
6,090,3
50
a
b
c=abd

5,968,3
66
6,090,3
50
121,9
0.4530
55,26
e=cxd

Actual Industry Volume

Budgeted Industry Volume
Difference
Budgeted Market Share
Market share (gain/Loss)
Budgeted unit contribution
Variance Due to industry Volume

12,180,0
00
11,440,0
00 740,0
00
50.00%
370,0
21
0.4530
167,6
23

Variance due to Industry Volume

a

b
c=a-b

d
e=c
xdf
g=exf
Total of Market and Industry
Volume Variance

112,363

Unit
Contribution
0.4329
0.4535
0.5713
0.4771
0.5153
0.4683
0.5359

Difference
3 = 2156,134.7
77,650.1
- 878.60
4,714.5
47,586.8
7
91,234.2
5 556.86

Difference
3 = 12104,492.7
687,114.1
32,119.6
0
11,368.5
08,879.1
3
27,254.7
56,808.1
4

Sales
Volume
varianc
20,934
4,292
709
3,175
29,097
55,488
3,947
117,6
42

Unit
Contribution
4
0.4329
0.4535
0.5713
0.4771
0.5153
0.4683
0.5359

Unit
Contribution
4
0.4329
0.4535
0.5713
0.4771
0.5153
0.4683
0.5359

Sales
Volume
varianc
5=4x3
24,30
35,21
-502
-2,249
24,522
42,725
298
5,279

Sales
Volume
varianc
5=4x3
45,235
39,506
1,211
5,424
4,575
12,763
3,648
112,3
63

More expenses are incurred than standard budgeted expense

es volume and the increased prices per gallon than the budgeted
prices. e variance statement could have been less favourable.

Price variance considering Actual Volume at the standard price taken for the actual sales
amount.

Difference
3 = 12-51,389.4
42,842.6
1,042.4
5,591.0
- 4,366.7
13,403.8
3,348.2

Unit
Contribution
4
0.4329
0.4535
0.5713
0.4771
0.5153
0.4683
0.5359

Sales
Volume
varianc
5=4x3
-22,24
19,42
-596
-2,667
-2,250
-6,277
-1,794
55,2

Performance for Frank Roberts

Sales
Advertising
Selling
TOTAL

Revised
Budgeted
Val
a
9,645,3
00578,7
00
368,8
00
10,592,8
00

Actual Value
b
9,657,3
00607,7
00
362,8
00
10,627,8
00

Difference
(A)
c=
a-b

12,0
-00
29,00
6,000
11,00

Actual Value at
Budgeted
Standard Cost
d
9,619,6
81577,1
87
368,8
00
10,565,6
68

Performance for John Parker

Manufacturing
Delivery
Administrative
TOTAL

Revised
Actual Value
Budgeted
Val
a
b
6,725,9
6,824,9
00760,8
00706,8
00
00
448,0
438,0
00
00
7,934,7
7,969,7
00
00
Dairy Ingredients variance
Milk Price Variance
Sugar Price Variance
Flavors variance

Difference
(C)
c=
a-b 99,00
54,0
00
10,0
-00
35,00

Actual Value at
Budgeted
Standard Cost
d
6,756,2
12711,7
21
448,0
00
7,915,9
33

TOTAL

Difference (B)
e=
d-b 37,61
-9
30,513
-6,000
1,107

Difference (D)
e=
d-b 68,688
4,921
10,00
-0
53,767
-31400
-57300
-23400
35300
-76800