The Carolina Rubber Products Company has completed the flexible budget analysis for the second quarter,which is as given below.
-Which of the following statements would be a correct interpretation of the sales volume variance for operating income?

Question

The Carolina Rubber Products Company has completed the flexible budget analysis for the second quarter,which is as given below.  
-Which of the following statements would be a correct interpretation of the sales volume variance for operating income?

Quizplus · Accepted Answer

The sales volume variance measures the difference between the actual and budgeted operating income resulting from the difference in the number of units sold. An increase in sales volume would be favorable and would result in a higher operating income than budgeted. Therefore, option C is the correct interpretation of the sales volume variance. Options A, B, and D are not related to the sales volume variance.

The Carolina Rubber Products Company Has Completed the Flexible Budget