Question

Clayton Industries has gathered the following information about the actual sales revenues and expenses for its pharmaceuticals segment for the most recent year. (Click the icon to view the actual data.) Budgeted data for the same time period for the pharmaceutical segment are as follows (al data is in milions): Click the icon to view the budgeted data.) Prepare a segment margin performance report for the pharmaceutical segment. Calculate a variance and a variance percentage for each line in the report. Round to the nearest hundredth for the variance percentages (for example, if your answer is 16.2384%,round it to 16.24%). Performance Report Clayton. Pharmaceutical Segment For Fiscal Year Ending December 31 Actual Bugeted Variance Variance % % Sales Less Variable Expenses Variable Cost of Goods Sold % % Variable Operating Expenses Contribution Margin

Answer 1

ANSWER

Clayton - Pharmaceutical Segment
For Fiscal Year Ending december 31
Particulars	Actual	Budgeted (WN 1)	Variance (WN 2)	Variance %
(a)	(b)	(c)	(d)	(e)
Sales	$1,412,880	$1,218,000	$194,880 F	16.00%
Less:Variable Expenses
Variable Cost of Goods Sold	$186,180	$174,000	($12,180) U	-7.00%
Variable Operating Expenses	$133,110	$147,900	$14,790 F	10.00%
Contribution Margin	$1,093,590	$896,100	$197,490 F	22.04%

Working Notes

WN - 1

Particulars	Budgeted No of Units (1)	Budgeted Amount (2)	Total (1) * (2)
Sales	8700	$140	$1,218,000
Variable Cost of Goods Sold	8700	$20	$174,000
Variable Operating Expenses	8700	$17	$147,900

WN - 2

Variance for sales and contribution = Actual - Budgeted

Variance for variable expenses = Budgeted - Actual