Felter Company reported that the total variance between actual and budgeted total contribution margin in April was $1000 favourable. The sales price variance was $5000 favourable. The fixed overhead budget variance was $1200 unfavourable. The sales volume variance was
A) $4000 unfavourable.
B) $4000 favourable.
C) $5200 unfavourable.
D) $5200 favourable.

Question

Quizplus · Accepted Answer

The total variance is the sum of the sales price variance and the sales volume variance. Given that the total variance is $1000 favourable and the sales price variance is $5000 favourable, the sales volume variance must be $4000 unfavourable to result in a net $1000 favourable variance.

Felter Company Reported That the Total Variance Between Actual and Budgeted