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Corfe Co.
Why not the anwer is first one as we know that when we flex the budget,the sales variance includes both volume and price variance.When the budget is flexed, the flexed sales revenue is the actual sales at standard selling price.
The sales variance is then the difference between the actual revenue and the flexed revenue and this is the sales price variance.
(The sales volume variance is costed at standard profit or contribution depending on whether they are using absorption or marginal costing).
Do watch again my lectures on this.
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