A company uses standard marginal costing. Last month the standard contribution on actual sales was $10000 and the following variance arose. total variable cost variance $2000 A Sales price variance $500 F Sales volume variance $1000 A What was the actual contribution for last month?
sir I am not able to understand how the answer was derived. Thanks
The sales volume variance is irrelevant because you are given the standard contribution on actual sales (not the budgeted contribution). Therefore the actual contribution is 10,000 – 2,000 + 500.