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Hi,
I don’t understand the statement below.
“The difference between the sales quantity and volume variances is that the standard mix is considered in the former. The difference between standard and actual is ignored.”
The sales volume variance compares the actual sales with the budgeted sales. This can then be analysed into the variance due to the change in the total quantity at standard mix, and the variance due to the change in the mix of the products.
I explain this in my free lectures on sales mix variances. The lectures are a complete free course for Paper PM and cover everything needed to be able to pass the exam well.
Understood! I didn’t comprehend it well when I read the statement before.
Thanks sir.
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