Sales in units: planned 1,000, actual 1020. Selling price per unit: planned $7. actual $6.9. Variable...
Sales in units: planned 1,000, actual 1020. Selling price per unit: planned $7. actual $6.9. Variable cost per unit $4.5 for planned and actual. Is the price variance Favorable or unfavorable variance?
| a. |
Favorable |
|
| b. |
Unfavorable |
|
| c. |
Neutral |
|
| d. |
0 |
|
| e. |
Significante |
Homework Answers
Ans. Option B Unfavorable
Explanation: If the actual sales price is higher than budgeted, it means the variance is favourable and if the actual sales price is less than budgeted then the variance becomes unfavorable.
In the question, actual selling price is 6.9 which is less than the planned selling price of 7. As a result the variance will be unfavorable.
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