The sales volume variance reflects
A)how efficiently the company operated in producing a given level of sales.
B)how effectively the company reached its strategic goals.
C)a different volume of products than that specified in the static budget.
D)only favorable variances.

Question

Quizplus · Accepted Answer

The sales volume variance compares the actual sales volume with the budgeted sales volume in the static budget. If the actual sales volume is different from the budgeted sales volume, then there will be a sales volume variance. This variance can be favorable or unfavorable, depending on whether the actual sales volume is higher or lower than the budgeted sales volume. The sales volume variance does not necessarily reflect efficiency or effectiveness in achieving strategic goals, as these are measured by other variances.

The Sales Volume Variance Reflects