Distributor of pharmaceutical products

Homework Essay Help: Exercise 14-22                                                                                                                                                                                  


Figure Four is a distributor of pharmaceutical products.  Its ABC system has 5 activities.                                                                                                                                                                                 

Rick Flair, the controller of Figure Four, wants to use this ABC system to examine individual                                                                                                                                                                                        

customer profitability within each distribution market.  He focuses first on the Ma and Pa                                                                                                                                                                                            

single-store distribution market.  Two customers are used to exemplify the insights available                                                                                                                                                                                    

with the ABC approach.  Data pertaining to these two customers in August 2012 are as                                                                                                                                                                                  


the basis of monthly operating income.  The cumulative operating income of the top 20%                                                                                                                                                                           

of customers is $55,680.  Figure Four reports negative operating income of $21,247 for the                                                                                                                                                                          

bottom 40% of its customers.                                                                                                                                                                    

Make four recommendations that you think Figure Four should consider                                                                                                                                                                             

in light of this new customer-profitability information.                                                                                                                                                                  

Exercise 14-25 Variance analysis, multiple products — sales variances
Soda-King manufactures and sells 3 soft drinks:  Kola, Limor, and Orlem.  Budgeted and
actual results for 2011 are as follows:
  Budget Information for 2011     Actual Information for 2011  
Selling Price Variable Cost Cartons Selling Price Variable Cost Cartons
Product per Carton per Carton Sold per Carton per Carton Sold
Kola $8.00 $5.00 480,000 $8.20 $5.50 467,500
Limor $6.00 $3.80 720,000 $5.75 $3.75 852,500
Orlem $7.50 $5.50 1,200,000 $7.80 $5.60 1,430,000
1.  Use the post method to calculate the individual product and total product variances
     requested below.  Calculate all variances in terms of contribution margin.
     a.  Compute the sales-price variance for August 2011.
     b.  Compute the sales-mix variance for August 2011.
     c.  Compute the sales-quantity variance for August 2011.
     d.  Compute the sales-volume variance for August 2011.
2.  What inferences can you draw from the variances computed in requirement #1?
Exercise 14-26 Market-share and market-size variances (continuation of 14-25).
     Soda-King prepared the budget for 2011 assuming a 12% market share based on total sales
     in the western region of the United States.  The total soft drinks market was estimated to reach 
     sales of 20 million cartons in the region.  However, actual total sales volume in the western
     region was 27.5 million cartons.  Calculate the market-share and market-size variances for Soda-
     King in 2011.  Calculate all variances in terms of contribution margin.  Use the post method.
Get 20% Discount on This Paper
Pages (550 words)
Approximate price: -

Try it now!

Get 20% Discount on This Paper

We'll send you the first draft for approval by at
Total price:

How it works?

Follow these simple steps to get your paper done

Place your order

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Receive the final file

Once your paper is ready, we will email it to you.

Our Services

Australia Assessments has gained an international reputation of being the leading website in custom assignment writing services. Once you give us the instructions of your paper through the order form, we will complete the rest.


Essay Writing Services

As we work towards providing the best custom assignment services, our company provides assignment services for any type of academic essay. We will help you develop professionally written essays that are rich in content and free from plagiarism.


Admission and Business Papers

Our skilled team of professional writers will ensure that we help you craft a remarkable admission essay for your desired Master's program in your institution of choice. We won't stop there. Once you enter the job market, we will be available to secure you a position at your desired worksite by creating an outstanding portfolio or resume.


Editing and Proofreading

Our editorial team is always available for all editing and proofreading services. They check completed papers by our writers and also provide professional opinions to papers completed by our clients.


Technical papers

We harbor professional academic writers with different qualifications in diverse academic fields. As such, we are capable of handling both simple and technical papers. Ensure that you provide us with correct and complete instructions in the order form.