Day: January 28, 2021

A company has a standard selling price of £12 per unit and budgeted sales of 80,000 units.

It has actual sales of 82,000 units with a total sales value of £955,300.

What is the sales price variance?

Select ONE answer:

1. £4,700 adverse
2. £24,000 adverse
3. £24,000 favourable
4. £28,700 adverse

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct – £955,300 / 82,000 = £11.65 ==> £12.00 – £11.65 = £0.35 * 82,000 ==> £28,700 ADV

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