John Company's master budget sales were $225,000.Actual sales were $220,000. Sales in the prior year were $219,000.The static-budget variance for sales was _____.

Question

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The static-budget variance for sales is calculated as the difference between the actual results and the budgeted amounts. Since the actual sales ($220,000) were less than the budgeted sales ($225,000), the variance is unfavorable. The difference is $5,000 ($225,000 - $220,000), making it a $5,000 unfavorable variance.

John Company's Master Budget Sales Were $225,000