Excel Case

Group 4 Financials

Income Reconciliation Example

Bicycles Sold4,500 4,500

2020Per Bicycle2021Per Bicycle

Sales Dollars19,800,000$ $4,400.0014,850,000$ $3,300.00

Direct Material Costs10,800,000$ $2,400.008,658,220$ $1,924.05

Direct Labor Costs1,552,500 345.00 1,460,025 324.45

Variable Overhead562,500 125.00 551,250 122.50

Total Variable Costs

12,915,000$ 2,870.00$ 10,669,495$ 2,371.00$

Contribution Margin6,885,000$ $1,530.004,180,505$ $929.00

Contribution Margin Percent34.77%28.15%

Selling & General Administration615,000$ 136.67 765,000$ 170.00

Operating Income6,270,000$ $1,393.333,415,505$ $759.00

Wheels of Fortune

Operating Income Statement

20202021

Professional 75%50%

Novice25%50%

Total Assembled & Sold4,500 4,500

20202021

Frames:Usage3,375 2,363

Price900$ 925$

Parts:Usage3,375 2,295

Price2,100$ 2,165$

Direct Labor Hours33,750 23,175

Direct Labor Rate40$ 42$

Variable Overhead Rate150$ 180$

20202021

Frames:Usage1,125 2,318

Price180$ 190$

Parts:Usage1,125 2,363

Price420$ 450$

Direct Labor Hours6,750 13,905

Direct Labor Rate30$ 35$

Variable Overhead Rate50$ 65$

Wheels of Fortune

Professional

Novice

Summary of Actual Costs

Sales Mix Percent

Difference

Operating Income 20206,270,000$

Total Sales Mix Variance378,000$

Manufacturing Variances

Direct Materials Variance

Usage(336,960)$

Price(370,800)

Direct Labor Variance

Efficiency(101,970)

Rate(48,060)

Variable Overhead Variance

Spending(121,500)

Total Manufacturing Variances(979,290)$

Selling & General Administration(150,000)$

Operating Income 20215,518,710$

(unfavorable)

Wheels of Fortune

Income Reconciliation