Garcia's performance evaluation system
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Diego Garcia owns a chain of travel goods stores. Last year, his sales staff sold 10,000 suitcases at an average sale price of $150. Variable expenses were 80% of sales revenue, and the total fixed expenses were $110,000. This year, the chain sold more expensive product lines. Sales were 8,000 suitcases at an average price of $200. The variable expense percentage and the total fixed expenses were same the both years. Garcia evaluates the chain manager by comparing this year's income with last years income.
1. Prepare a performance report for this year. How would you improve Garcia's performance evaluation system to better analyze this year's results?
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Solution Summary
The solution provides variance report and suggesting for performance evaluation.
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I would show the sales price per unit and the number of units (see pink area above) so that the sales revenue variance can be analyzed by ...
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