Timberlake Company planned for a production and sales volume of 12,000 units. However, the company actually made and sold 13,000 units. What was the sales volume variance?
A) $65,000 favorable
B) $65,000 unfavorable
C) $29,800 unfavorable
D) $29,800 favorable

Question

Timberlake Company planned for a production and sales volume of 12,000 units. However, the company actually made and sold 13,000 units.  What was the sales volume variance?
A) $65,000 favorable 
B) $65,000 unfavorable 
C) $29,800 unfavorable 
D) $29,800 favorable

Quizplus · Accepted Answer

Sales volume variance = Static budget (based on planned volume) − Flexible budget (based on actual volume)
Sales volume variance = $780,000 − $845,000 = $65,000 unfavorable
Since the actual volume was greater than the planned volume, the variance is favorable.

Timberlake Company Planned for a Production and Sales Volume of 12,000