The Comfort Foam Products Company completed the flexible budget analysis for the second quarter, which is given below. Which of the following would be a correct factor to explain the sales volume variance for variable costs?

Question

The Comfort Foam Products Company completed the flexible budget analysis for the second quarter, which is given below.  Which of the following would be a correct factor to explain the sales volume variance for variable costs?

Quizplus · Accepted Answer

Sales volume variance for variable costs is attributed to the change in sales volume. An increase in sales volume results in higher variable costs incurred. Decrease in sales price per unit and increase in variable cost per unit affect the variable cost per unit but not the sales volume variance. Increase in fixed costs would affect fixed cost variance, not the sales volume variance.

The Comfort Foam Products Company Completed the Flexible Budget Analysis