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Which option correctly fills the gaps in the paragraph?
“The difference between the sales quantity and _____________ variances is that the
standard _______________is considered in the former. The difference between
standard and actual is ________________.”
A volume, mix, ignored
B price, mix, calculated
C volume, quantity, ignored
D price, quantity, calculatedsir i don’t understand why the answer is A
The sales volume variance is calculated comparing actual sales to budgeted sales. It can be analysed into the sales mix and sales quantity variances.
The sales quantity variance is calculated using the standard mix for the actual total sales and compares with the budgeted total sales and ignores any change in the mix.
Have you watched my free lectures on this?
In a subsequent 4 week period, Birch Co’s actual fixed costs were $3,500. There were 18,000 units
produced. The budgeted fixed costs was $3,000 based on budgeted production of 17,500 units.
Calculate the fixed production overhead total variance.
A. $440 (A)
B. $525 (A)
C. $500 (F)
D. $500 (A)
Sir answer is A.
Why the Fixed cost has been treated as Variable cost here?
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