An Unfavorable Sales Volume Variance in Operating Income Suggests A(n)________

question 195

Multiple Choice

An unfavorable sales volume variance in operating income suggests a(n) ________.

• A) increase in number of actual units sold when compared to the expected number of units sold
• B) decrease in number of actual units sold when compared to the expected number of units sold
• C) increase in variable cost per unit
• D) decrease in fixed costs

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Definitions:

Sales Tax

A tax imposed by a government on the sale of goods and services.

Credit Period

Length of time allowed for payment of goods sold on account.

Discount Period

The time frame in which a payment can be made at a reduced rate.

Contra-revenue Account

An account that offsets revenue accounts on the income statement, such as sales returns, allowances, and discounts.