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A profit centre manager claims that the poor performance of their division is entirely due to factors outside their control.
They have submitted the following table along with notes from a market expert, which they believe explains the cause of the poor performance:
budget sales unit is 500
actual sold is 300
The entire market has decreased by 25%?
why isnt this poor performance?sales revenue and material cost I understood , but i didnt understand sales units performance
thanks
When sales volumes and prices are flexed it can be seen that the manager performed better.
You understood that the material price when flexed is higher than budget whilst the external environment shows that prices are reducing. This indicates that although suppliers lowered their prices the manager has still overspent which indicates poor performance.
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sales volume is onyl 300 , they should have atleast sold 375? i didnt understand
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