(Appendix 11A)If Two Products Are Close Substitutes,the Sales Volume Variance

question 144

True/False

(Appendix 11A)If two products are close substitutes,the sales volume variance for each product can be split into a sales quantity variance and a sales mix variance.

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Definitions:

Net Credit Sales

The total revenue from sales made on credit, minus any returns or allowances.

Allowance for Doubtful Accounts

A contra-asset account that represents the estimated portion of accounts receivable that may not be collectible.

Uncollectible

denotes accounts receivable that cannot be collected and are therefore written off as a loss by a business.

Adjustment

An entry in bookkeeping that corrects or allocates income and expenditure to the appropriate accounting periods.