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Author Question: Blue States Coffee, Inc., sells two types of coffee, Colombian and Blue Mountain. The monthly budget ... (Read 514 times)

tiffannnnyyyyyy

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Question 1

When there is a lesser degree of homogeneity, fewer cost pools are required to accurately explain the use of company resources.
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Question 2

Blue States Coffee, Inc., sells two types of coffee, Colombian and Blue Mountain. The monthly budget for U.S. coffee sales is based on a combination of last year's performance, a forecast of industry sales, and the company's expected share of the U.S. market. The following information is provided for March:

ActualBudget
ColombianBlue MountainColombianBlue Mountain
Sales in pounds15,000 lbs.17,000 lbs.13,500 lbs.18,000 lbs 
Price per pound$13.00$16.00$13.00$16.00
Variable cost per pound5.009.006.509.00 
Contribution margin$8.00$7.00$6.50$7.00 

Budgeted and actual fixed corporate-sustaining costs are $60,000 and $72,000, respectively. 

Required: 
a.  Calculate the actual contribution margin for the month.
b.  Calculate the contribution margin for the static budget.
c.  Calculate the contribution margin for the flexible budget.
d.  Determine the total static-budget variance, the total flexible-budget variance, and the total sales-volume variance in terms of the contribution margin.


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Marked as best answer by tiffannnnyyyyyy on Mar 6, 2021

perkiness

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