Question

Salespersons' Report and Analysis

Walthman Industries Inc. employs seven salespersons to sell and distribute its product throughout the state. Data taken from reports received from the salespersons during the year ended December 31 are as follows:

Salesperson	Total Sales		Variable Cost of Goods Sold			Variable Selling Expenses
Case	$604,000		$295,960			$114,760
Dix	375,000		131,250			56,250
Johnson	411,000		226,050			65,760
LaFave	450,000		189,000			58,500
Orcas	423,000		241,110			84,600
Sussman	424,000		165,360			93,280
Willbond	588,000		264,600			99,960

Required:

1. Prepare a table indicating contribution margin, variable cost of goods sold as a percent of sales, variable selling expenses as a percent of sales, and contribution margin ratio by salesperson. Round percents to the nearest whole number. Enter all amounts as positive numbers.

Waltham Industries Inc.
Salespersons' Analysis
For the Year Ended December 31
Salesperson	Contribution Margin	Variable Cost of Goods Sold as a Percent of Sales	Variable Selling Expenses as a Percent of Sales	Contribution Margin Ratio
Case	$	%	%	%
Dix		%	%	%
Johnson		%	%	%
LaFave		%	%	%
Orcas		%	%	%
Sussman		%	%	%
Willbond		%	%	%

2. Which salesperson generated the highest contribution margin ratio for the year?

3. Identify the factors other than contribution margin that should be considered in evaluating the performance of salespersons.

1. Rate of growth in sales for the current year compared with past years
2. Years of experience for salespersons
3. Size of sales territory
4. Actual sales compared with budgeted sales
5. All of the above

Answer 1

Waltham Industries Inc.
Salespersons' Analysis
For the Year Ended December 31
Salesperson	Contribution Margin	Variable Cost of Goods Sold as a Percent of Sales	Variable Selling Expenses as a Percent of Sales	Contribution Margin Ratio
Case	$193,280	49%	19%	32%
Dix	$187,500	35%	15%	50%
Johnson	$119,190	55%	16%	29%
LaFave	$202,500	42%	13%	45%
Orcas	$97,290	57%	20%	23%
Sussman	$165,360	39%	22%	39%
Willbond	$223,440	45%	17%	38%
2. Which salesperson generated the highest contribution margin ratio for the year?
Dix
3.Other factors
5.All of the above