Sales & Gross Profit Variance Analysis (Price, Mix, Volume)

Financial Analysis, Gross profit margin analysis, Price, volume, Mix, Quantity variances, Presentation, Recommendations

Created by: Umair Bhatti, CPA, CGA, FCCA
Regional Controller, CPA, CGA, FCCA

What Will I Learn?

• What are sales related variances and how do they impact profit of a business? How do these variances help explain business performance?
• How to explain variances resulting from sales price, quantity and product mix differences.
• How to completely explain variance vs budget and previous year in terms of dollar amounts and profit percentage (%).
• How to automate variance calculation in Microsoft Excel so that files can be updated every time a new calculation is required.
• How to summarize variance calculation results in the form of automated graphs/charts.
• How to present the results of variance analysis to management using Microsoft Powerpoint.
• How to analyse and provide recommendations to management based on results of analysis.
• Complete solved Excel files

Requirements

• A general understanding of sales, cost and profit (Not mandatory).

Target audience

• Anyone interested in explaining financial performance vs target or previous period driven by sales variances
• Accountants
• Financial Analysts
• Controllers
• Sales Managers and Sales staff
• Sales Directors
• General Managers and Managers of Operations
• CFOs and CEOs