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Pg 299 question 13 in BPP
Why the answer is material cost?
There are two figures missing from the question that were in the original exam question.
Against sales revenue is should say that selling prices fall by 10%, and against raw materials it should say that suppliers lowered their prices by 5%.
If you compare the actual this year with the actual last year, then sales volume fell by the same % os the entire market. So not poor performance.
The selling price per unit fell by less than 10%, so not poor performance.
The material cost per unit increased even though suppliers lowered their price, which is poor performance.