Question

The​ ________reveals whether or not additional sales revenue can offset an increase in costs in the flexible budget performance report. A. actual variance B. sales volume variance C. flexible budget variance D. static budget variance

Answer 1

Answer: (B) Sales volume variance

Explanation:

 The sales volume variance is basically defined as the difference between the expected sold unit and the actual sold unit. The formula of sales volume variance is given by:

Sales volume variance = (Actual sold - Budget sold) × budget price

The sales volume variance is caused due to the price, product recall and the competition. It is also known as the sale quantity variance. The sales volume variance is basically reveals the total additional sale revenue that increase the cost of budget.

Therefore, option (B) is correct.