Johnson Construction Materials Company has a sales office which sells concrete culvert pipe to property developers. The sales office is a revenue center and must prepare a monthly performance report. It has provided the data below.
How much is the sales volume variance for the 32 inch pipe?

Question

Johnson Construction Materials Company has a sales office which sells concrete culvert pipe to property developers. The sales office is a revenue center and must prepare a monthly performance report. It has provided the data below.
 How much is the sales volume variance for the 32 inch pipe?

Quizplus · Accepted Answer

The formula for sales volume variance is (actual quantity sold - budgeted quantity sold) x budgeted price.

For 32 inch pipe:

Sales volume variance = (2,400 - 2,000) x $20 = $8,000 U

Therefore, the answer is (C) $8,000 U.

Johnson Construction Materials Company Has a Sales Office Which Sells