The Difference Between the Actual Sales Volume for a Period

question 50

Multiple Choice

The difference between the actual sales volume for a period and the flexible-budget sales volume is equal to:

• A) The total sales volume variance for the period.
• B) The total production-volume variance for the period.
• C) The sales price variance for the period.
• D) The operating-income sales volume variance for the period.
• E) Zero—by definition.

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Definitions:

Total Profit

The net amount of money a business retains after subtracting all its expenses, taxes, and costs from its total revenue.

MC Curve

Marginal Cost Curve, which shows the change in total cost that arises when the quantity produced changes by one unit.

AVC Curve

A graph representing the Average Variable Cost of producing different quantities of output, typically showing how AVC decreases and then increases.

Market Demand

The overall sum of a particular good or service that every customer in a market is eager and able to acquire at a range of prices.