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hi john, do not know how to calculate market size and share
sales volume 180,000 unit
sales price $17.00 per unit
standard contribution$7.00total market estimated in the budget to be 1.8m units in fact, actual total market shank 1.6m units , the actual total market shrank to 1.6m units for the period
actual sales volume 176000units
sales price $16.40per unitanalyse the total sales volume variance into components for market size & market share
If they budgeted on selling 180,000 units when the market size was 1.8M, then it means they were expecting their share of the market to be 180,000/1.8M = 10%.
Therefore if the actual size of the market was only 1.6M, they would then expect their sales to be 10% x 1.6M = 160,000. Therefore the difference of 20,000 units (A) would be due to the change in market size.
They actually sold 176,000, which is 16,000 more than they would not have expected, therefore the 16,000 units (F) is due to a change in the market share.
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