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The sales volume of a business will differ from budget because either the market as a whole is bigger (if the market as a whole is bigger than we would expect our sales to be bigger) – this is the market size variance; or alternatively because our share of the market is different than budgeted – this is the market share variance.
This has not often been examined but you should find at least one example of the calculations in your Revision Kit.
in other words we can say that market size variance is the sales volume planning variance and market share variance is sales volume operational variance.Am i right or wrong?
this was asked in mar this year.
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