The Alaska Fish Company completed the flexible budget analysis for the second quarter,which is given below. Which of the following statements would be a correct factor to explain the sales volume variance for operating income?

Question

The Alaska Fish Company completed the flexible budget analysis for the second quarter,which is given below.  Which of the following statements would be a correct factor to explain the sales volume variance for operating income?

Quizplus · Accepted Answer

The sales volume variance for operating income is caused by the difference between the actual sales volume and the budgeted sales volume. An increase in sales volume would result in a favorable sales volume variance, which would increase operating income. Decrease in sales price per unit (A) and increase in variable cost per unit (B) would impact the contribution margin per unit but not the sales volume variance. Increase in fixed costs (D) would impact the fixed cost variance but not the sales volume variance.

The Alaska Fish Company Completed the Flexible Budget Analysis for the Second