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Leaf limited has had a mixed year. Its market share has improved two percentage to 20% but the overall market had contracted by 5% in the same period.The budget sales were 504,000 units and standard contribution was $12 per unit.
What is the level of actual sales?
please can you show the answer with the detail process.
The budgeted sales must have been 18% (20 – 2) of the expected market sales. So they must have expected the market sales to be 504,000/18% = 2,800,000.
The market actually contracted by 5%, so the actual market sales were 95% x 2,800,000 = 2,660,000.
Their actual share of the market was 20%, so their actual sales were 20% x 2,660,000 = 532,000.
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