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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA MA – FIA FMA › Sales Volume Variance
Good day
I am attempting the following question.
A company is reviewing actual performance to budget to see where there are differences. The following standard information is relevant:
$
per unit
Selling price 50
––
Direct materials 4
Direct labour 16
Fixed production overheads 5
Variable production overheads 10
Fixed selling costs 1
Variable selling cost 1
––
Total costs 37
––
Budgeted sales units 3,000
Actual sales units 3,500
What was the favorable sales volume variance using marginal costing?
I am unsure if the standard contribution per unit is $20 or $19 ($19 will include the variable selling cost in my calculation of contribution per unit).
Do I include the Variable selling cost in my calculation or do I focus on the Variable Production costs only?
The contribution is after charging all variable costs and so in this example is $19
