The Sales Quantity Variance Would Be Favorable When a Company

question 112

Multiple Choice

The sales quantity variance would be favorable when a company sells:

• A) relatively fewer of the products bearing contribution margins lower than average.
• B) relatively more of the products bearing contribution margins higher than average.
• C) more total units than budgeted, holding the sales mix constant.
• D) less total units than budgeted, holding the sales mix constant.

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Definitions:

Wage Rate

The amount of money paid to workers per unit of time, often hourly or monthly, for their labor.

MRP

Marginal Revenue Product, the additional revenue generated from using one more unit of a factor of production.

Rent

Payment made periodically by a tenant to a landlord in exchange for the use of land, a building, or another property.

MRP

The additional revenue produced by increasing one unit of a production input, emphasizing the productivity aspect in revenue generation.