(Solution) - Tom and Lynda own Hercules Health Club For the month of -(2025 Original AI-Free Solution)

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Academic Level: Undergrad. (yrs 3-4)

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Tom and Lynda own Hercules Health Club. For the month of April, they had forecasted gym membership at 700 individual members and 300 family memberships. Individual members pay $100 per month and families pay $150 per month. Variable costs are $35 and $60 per month, respectively. Actual results for April show membership at 750 individual and 250 family members.

Required:
a. Determine Hercules? sales volume variance.
b. Decompose the sales volume variance into a sales mix variance and a sales quantity variance.
c. Why did Hercules? contribution decrease even though the total memberships were the same?