Lola Inc. produces a product with the following revenue and cost structure Selli

Question

Lola Inc. produces a product with the following revenue and cost structure Selling price Variable cost per unit Fixed costs $86.03 44.21 800,000 Budgeted production and sales for the year ending December 31, 20x9 is 24461 units. The actual results at the end of the year, December 31, 20x9, are given below Actual selling price Variable cost per unit Fixed costs Actual volume 82.55 21.94 850,000 27280 What is Lola's sales volume variance for the year 20x9 Note: a negative number represents an unfavourable variance and a positive number represents a favourable variance Select one a $-117891 b. $-94934 C. $117891 d. $170860

Explanation / Answer

Sales volume variance = (Budgeted sales volume-Actual sales volume)*budgeted sell price

= (24461-27280)*41.82

Sales volume variance = 117891

So answer is c) $117891

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