Cost Accounting (15th Edition)

Published by Prentice Hall
ISBN 10: 0133428702
ISBN 13: 978-0-13342-870-4

Chapter 14 - Cost Allocation, Customer-Profitability Analysis, and Sales-Variance Analysis - Assignment Material - Questions - Page 579: 14-13

Answer

The composite unit concept helps understand unfavorable total sales-mix variance. It occurs when the actual product mix sold differs from the budgeted mix, impacting overall contribution margin negatively. This means the actual mix was less profitable than budgeted, resulting in a lower contribution margin.

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