ACCA PM · Chapter 12 · Question 12 of 12
A company's standard selling price for product T is $50 per unit. During the period it sold 1,900 units at an average price of $48 per unit. What is the sales price variance?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) $3,800 adverse
Explanation
Sales price variance = (actual price - standard price) x actual units sold = ($48 - $50) x 1,900 = $3,800 adverse. It is adverse because each unit was sold for less than the standard price, and it is based on actual, not budgeted, quantity.
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