This document contains several exercises involving gross profit variance analysis for one or more products. It includes calculations of overall gross profit variance, sales price variance, sales volume variance, cost price variance, and cost volume variance. For some exercises, only limited financial information is provided and variances must be calculated based on changes in sales, costs, prices or volumes between two periods. The goal is to identify the causes of differences in gross profit amounts.
This document contains several exercises involving gross profit variance analysis for one or more products. It includes calculations of overall gross profit variance, sales price variance, sales volume variance, cost price variance, and cost volume variance. For some exercises, only limited financial information is provided and variances must be calculated based on changes in sales, costs, prices or volumes between two periods. The goal is to identify the causes of differences in gross profit amounts.
This document contains several exercises involving gross profit variance analysis for one or more products. It includes calculations of overall gross profit variance, sales price variance, sales volume variance, cost price variance, and cost volume variance. For some exercises, only limited financial information is provided and variances must be calculated based on changes in sales, costs, prices or volumes between two periods. The goal is to identify the causes of differences in gross profit amounts.
FINANCIAL STATEM ENT ANALYSIS EXERCISES: GP VARIANCE ANALYSIS 1. GROSS PROFTT ANALYSTS WrTH A SINGLE PRODUCT (FULL INFORMATION) , Spain Company prepared the following budgetary inforrnation for January 2Ol7: Sales (12,0O0 units) P 432,OAO Cost of Goods Sold 288.000 Gross Proflt P:!4@ In January, actual operations resulted in the production and sale of 13r0O0 units which were sold for a selling price of P 34 per unit. The unit cost of goods sold increased by P 3. REQUIRED: 1. Overall GP variance 2. Sales price variance 3. Sales volume variance 4. Cost price variance 5. . Cost volume variance (Adapted: AICPA) 2. GROss PROFITTANALYSIS WITH A SINGLE PRODUCT (INCOMPLETE INFORMATION) Rafa Company has requested you to determine the cause of the difference between its 2Ot6 and 2O17 gross profit based on the following data: 2016 2017 Sales P200,000 P252,000 Cost of Goods Sold 120,000 180,-000 Gross Profit e ,&oo Pd2-409 No additional data was made available except that unit sales increased by 2$o/o in 2AL7. REQUIRED: 1. Overall GP variance 2. Price factor 3. Cost factor 4. Volume factor (Adapted: AICPA) 3. GROSS PROFTTANALYSIS EXERCISES 14)_,9"";*9o.qlgely-l'9gl!9. Sales P160,000 P162,500 Cost of goods sold (P 5 per unit) 100,000 102,500 Gross profit P=.s@00 P_oaJoo If actual sales were 500 units higher than the budgeted sales, then which is a FALSE statement? a. The sales price variance is P 1,500 unfavorable. b. The sales volume variance is P 4,O00 favorable. c. The cost price variance is zero (O). d. The cost volume variance is P 2,5O0 favorable. Items 3B to 3F are based on the following information The management of R-18 Company asked you to submit an analysis of the increase in the gross profit in 2017 based on the past two-year comparative income statements, which are shown below: 2017 2016 Net Sales P L,237,5AA P 1,000,000 cost of sales 950,ooo 900.000 Gross Profit P_287*s0O P_a00J@ The selling price increased by 12.5o/o beginning January 201,7. 38) What is the increase in gross profit due to increase in volume? (VOLUME FACTOR) a. P 20,000 c. p 50,000 b. P 35,000 d. P 100,000 3C) How much is the gross profit decline due to increase in cost? (COST FACTOR) a. P 70,000 c. P B8,0OO b. P B0,OO0 d. P 97,500 3D) The increase in sales prices caused an increase in gross profit by (PRiCE FACTOR) a. P 100,000 c. P 137,500 b. P 110,000 d. P 237,500 3E) What is the percentage change in volume? a. 9o/o c. Lto/o b. 7Oo/o d. 72-75o/o 3F) What is the percentage change in cost? a. 10.8olo c. 8.6750/o b.' laa/a d. 7.95o/o