The sales gap due to reduced volume is ________ percent.
A) 0.4
B) 2.5
C) 28.5
D) 63
E) 71.4

Question

Quizplus · Accepted Answer

To calculate the sales gap, we need to use the formula:
Sales gap = (Actual sales – Budgeted sales) / Budgeted sales

Using the data given in the question, we can calculate the sales gap as follows:
Actual sales = 14,500
Budgeted sales = 50,500
Sales gap = (14,500 – 50,500) / 50,500
Sales gap = -71.4%

The negative sign indicates a reduction in sales, which is what we were told in the question. Therefore, the correct answer is E, 71.4.

The Sales Gap Due to Reduced Volume Is ________ Percent