A company had actual selling price per unit of $15, standard selling price per unit of $15.75, and sold 5,000 units. What is the sales price variance?

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Multiple Choice

A company had actual selling price per unit of $15, standard selling price per unit of $15.75, and sold 5,000 units. What is the sales price variance?

Sales price variance measures how actual revenue changes from the planned revenue because of a different selling price, keeping the actual volume in mind. It’s computed as (Actual selling price minus Standard selling price) times Actual units sold. Here, the actual price per unit is 15.00 and the standard price is 15.75, so the price difference is -0.75 per unit. Multiplied by 5,000 units gives -3,750. The negative result shows the actual revenue was below the standard by 3,750, i.e., an unfavorable variance. So the amount is 3,750 Unfavorable.

A company had actual selling price per unit of $15, standard selling price per unit of $15.75, and sold 5,000 units. What is the sales price variance?

Prepare for the Accounting SmartBook Test. Practice with tailored questions and helpful hints. Analyze comprehensive explanations for a deep understanding. Ace your exam with confidence!

A company had actual selling price per unit of $15, standard selling price per unit of $15.75, and sold 5,000 units. What is the sales price variance?

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