Additional insight can be gained by dividing the sales-volume variance into the sales-mix variance and the sales-quantity variance.

Question

Quizplus · Accepted Answer

Dividing the sales-volume variance into sales-mix variance and sales-quantity variance allows for a more detailed analysis of the factors that contributed to changes in sales volume. The sales-mix variance pertains to changes in the relative proportions of different products or services sold, while the sales-quantity variance refers to changes in the actual number of units sold. By isolating these two factors, companies can better understand the impact of changes in product mix and changes in sales volume on overall revenue.

Additional Insight Can Be Gained by Dividing the Sales-Volume Variance