A Machine Distributor Sells Two Models, Basic and Deluxe Actual Sales Were 7,000 Basic Models and 2,800 Deluxe Models

question 53

Multiple Choice

A machine distributor sells two models, basic and deluxe. The following information relates to its master budget.
$$\begin{array} { l c c } & \text { Basic } & \text { Deluxe } \\\text { Sales (units) } & 8,000 & 2,000 \\\text { Sales price per unit } & \$ 8,000 & \$ 12,000 \\\text { Variable costs per unit } & \$ 6,400 & \$ 9,000\end{array}$$
Actual sales were 7,000 basic models and 2,800 deluxe models. The actual sales prices were the same as the budgeted sales prices for both models.
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Is the sales mix variance for the basic model favorable or unfavorable?

• A) Favorable.
• B) Unfavorable.

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Definitions:

Astrocyte

A type of star-shaped glial cell in the brain and spinal cord, involved in biochemical support of endothelial cells that form the blood-brain barrier.

Sensory Receptors

Specialized cells or nerve endings that respond to changes in the environment by generating signals that travel to the nervous system.

Action Potentials

Rapid, momentary changes in the electrical potential across a cell membrane, key in the transmission of nerve impulses.

Effectors

Organs, glands, or cells that act in response to stimuli, executing the responses of the nervous or hormonal system to external or internal changes.