The market share variance is calculated by
A)[(Actual industry sales in units −Budgeted industry sales in units) × (Budgeted market share percentage)] × (Budgeted average unit contribution margin).
B)[(Actual market share percentage − Budgeted market share percentage) × Actual industry sales in units] × Budgeted average unit contribution margin.
C)(Actual quantity sold − Budgeted quantity sold) × Budgeted average unit contribution margin.
D)(Actual quantity sold − Budgeted quantity sold) × Actual average unit contribution margin.

Question

Quizplus · Accepted Answer

The market share variance measures the impact of the difference between the budgeted and actual market share percentage on the budgeted contribution margin. Option B calculates this by multiplying the difference between the budgeted and actual market share percentage by the actual industry sales in units and the budgeted average unit contribution margin.

The Market Share Variance Is Calculated by