Question 1

**Section B - Case 2: AeroLogix**

AeroLogix provides drone-based medical delivery. They budgeted to sell 5,000 delivery subscriptions at a standard contribution of $40 each. The total market size was estimated at 50,000 subscriptions (AeroLogix budgeted market share = 10%).

Actually, the total market shrank to 40,000 subscriptions due to regulatory changes. AeroLogix actually sold 4,500 subscriptions.

Calculate the Sales Market Share Variance in terms of contribution. (Enter your answer as a positive number for adverse, or negative for favorable).

Accepted Answer

1. Calculate actual market share (4,500 / 40,000). 2. Compare actual market share to budgeted market share (10%). 3. Apply the difference in market share to the actual total market size to find the difference in units. 4. Multiply by standard contribution per unit.

Question 2

What mistakes do candidates make on this ACCA question?

Accepted Answer

Calculating the total sales volume variance or the market size variance instead of the market share variance.

How to approach this question

Full Answer

Common mistakes

Practice the full ACCA PM — Performance Management Practice Exam 2

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