Sales variance is the difference between budgeted sales and actual sales. Sales variance can be because of two reasons • Actual selling price of the product varies from the budgeted selling price and/or • Actual quantity of sales varies from the budgeted quantity. Therefore, sales variance is the sum of (i) Sales Price Variance and (ii) Sales Volume Variance. Sales Price Variance: The difference between the actual selling price and the budgeted selling price is the Sales Price Variance. Sales Volume Variance: The difference between actual quantity of sales and budgeted quantity is the Sales Volume Variance. The following formulas are used to calculate Sales variance: SalesVariance=Sales Price Variance+ Sales Volume Variance Also Sales Variance = Budgeted Sales – Actual Sales Sales Price Variance = Actual Sales - Actual quantity of Sales at budgeted price Sales Volume Variance = Actual quantity at budgeted price -Budgeted quantity at budgeted price Sales variance gives a view of deviations from the set standards which can be wither favorable or unfavorable To Determine: Sales Price and Volume Variance

Question

Want to see the full answer?

Answer 1

Question

Chapter 23, Problem 20QS

To determine

Concept Introduction:

Sales variance is the difference between budgeted sales and actual sales. Sales variance can be because of two reasons

• Actual selling price of the product varies from the budgeted selling price and/or

• Actual quantity of sales varies from the budgeted quantity.

Therefore, sales variance is the sum of (i) Sales Price Variance and (ii) Sales Volume Variance.

Sales Price Variance:The difference between the actual selling price and the budgeted selling price is the Sales Price Variance.

Sales Volume Variance:The difference between actual quantity of sales and budgeted quantity is the Sales Volume Variance.

The following formulas are used to calculate Sales variance:

SalesVariance=Sales Price Variance+ Sales Volume Variance

Also Sales Variance = Budgeted Sales – Actual Sales

Sales Price Variance = Actual Sales - Actual quantity of Sales at budgeted price

Sales Volume Variance = Actual quantity at budgeted price -Budgeted quantity at budgeted price

Sales variance gives a view of deviations from the set standards which can be wither favorable or unfavorable

To Determine: Sales Price and Volume Variance

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

On 17-Feb of year 1, Javier purchased a building, including the land it was on, to assemble his new equipment. The total cost of the purchase was $1,302,500; $295,000 was allocated to the basis of the land and the remaining $1,007,500 was allocated to the basis of the building. (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.) Note: Do not round intermediate calculations. Round your answers to the nearest whole dollar amount. e. What would be the depreciation for 2024, 2025, and 2026 if the property were nonresidential property purchased and placed in service 17-Feb, 2007 (assume the same original basis)? Depreciation Year Expense 2024 2025 2026

What percentage of RBC’s total assets is held in investments (at October 31, 2020 and 2019)? refer to the 2020 financial statements and accompanying notes of Royal Bank of Canada (RBC). Note that RBC also holds a significant loan portfolio. What is the business reason for holding loans versus securities? Comment on how the investments are classified and presented on the balance sheet. What percentage of total interest income comes from securities (2020 and 2019)? Are there any other lines on the income statement or in OCI) relating to the securities? What percentage of net income (include any relevant OCI items) relates to securities (2020 versus 2019)? Calculate an approximate return on the investments in securities.

You are the partner-in-charge of a large metropolitan office of a regional public accounting firm. Two members of your professional staff have come to you to discuss problems that may affect the firm's independence. Neither of these situations has been specifically answered by the AICPA Professional Ethics Division. Case 1: Don Moore, a partner in the firm, has recently moved into a condominium that he shares with his girlfriend, Joan Scott. Moore owns the condominium and pays all the expenses relating to its maintenance. Otherwise, the two are self-supporting. Scott is a stockbroker, and recently she has started acquiring shares in one of the audit clients of this office of the public accounting firm. The shares are held in Scott's name. At present, the shares are not material in relation to her net worth. 1. What arguments would indicating that the firm's independence has not been impaired? 2. What arguments would indicating that the firm's independence has been impaired? 3. Which…