The sales-volume variance is subdivided into ________.
A) sales-mix variance and static-budget variance
B) sales-mix variance and sales-quantity variance
C) flexible-budget variance and fixed-budget variance
D) market-share variance and static-budget variance

Question

Quizplus · Accepted Answer

The sales-volume variance is divided into two parts: sales-quantity variance and sales-mix variance. Sales-quantity variance measures the effect of actual quantity sold on the total revenue, assuming the actual product mix is the same as the planned product mix. Sales-mix variance measures the effect of the difference between the actual product mix and planned product mix on the total revenue. Therefore, option B is the correct answer.

The Sales-Volume Variance Is Subdivided into ________