Dante Fernandez owns a chain of travel goods stores. Fernandez Travel Goods. Las

Question

Dante Fernandez owns a chain of travel goods stores. Fernandez Travel Goods. Last year his sales staff sold 15,000 suitcases at an average sale price of $180. Variable expenses were 85% of sales revenue and the total fixed expense was $180,000. This year, the chain sold more expensive product lines. Sales were 14,000 suitcases at an average price of $280. The variable expense percentage and the total fixed expenses were the same both years. Fernandez evaluates the chain manager by comparing this year's income with last year's income. Prepare a performance report for this year. How would you improve Fernandez's performance evaluation system to better analyze this year's results? Begin by preparing a performance report. (Complete all answer boxes. Enter a "O for zero amounts.) Fernandez Travel Goods Income Statment Performance Report This Year Last Year Number of suitcases sold Sales Revenue Variable Expenses Contribution Margin Fixed Expenses Operating Income

Explanation / Answer

Dear Student Thank you for using Chegg Fernandez Travel Goods Please find below the answer    Income Statement performance report Statementshowing Computations Paticulars This Year Last Year Variance Comments No of suitcases sold            15,000.00           14,000.00            (1,000.00) Unfavourable Sales Revenue      2,700,000.00     3,920,000.00      1,220,000.00 Favourable Less Variable Expenses (2,295,000.00) (3,332,000.00)    (1,037,000.00) Unfavourable Contribution Margin         405,000.00         588,000.00          183,000.00 Favourable Fixed cost       (180,000.00)      (180,000.00)                           -   Operating income         225,000.00         408,000.00          183,000.00 Favourable

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