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John Moffat.
John Moffat.-
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nbhutia
- Topics: 28
- Replies: 20
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Hi Sir,
I don’t seem to understand the market size and share variances in section C part B.
So the market share was std volume – revised volume @std contribution for nurses. I don’t understand where the contribution figures are coming from??
They have done budgeted units so 4200*80%? But would that not be in units? And not in contribution? Because Q1 nurses was £14m/£1000 per nurse= 14000 in volume then*30%= 4200 in units
With revised it’s revised sales volume of 5670*80% but they haven’t used std contribution for it?
Thanks you so much in advance sir.
John Moffat
- Topics: 57
- Replies: 49993
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4,200 is not the budgeted units. It is the budgeted revenue. The national market for nurses was $14M and they held 30% share, so 30% x $14M = $4.2M (again this is revenue and not units).
The standard contribution margin (per the question) is 80%, and the contribution margin is the contribution as a % of the revenue. So the budgeted standard contribution was 80% x $4.2M = $3,360.
dcosta01
- Topics: 1
- Replies: 9
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Hi Sir,
for this question, could you please clarify in part c how the amounts of 13,230 and 2,870 been calculated?
many thanks in advance
John Moffat
- Topics: 57
- Replies: 49993
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The sales director reported the figures as being 30% lower.
18,900 – (30% x 18,900) = 13,230
70% x 4,100 = 2,870.
nbhutia
John Moffat
dcosta01
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