Tag: Sales Price Variance

Accounting Multiple Choice Question – 10 November 2023

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

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Budgeted and actual sales of a product sold by Alex Trading Ltd are given.

  • sales in units: budget 2,000 and actual 1,800
  • selling price per unit: budget £15 and actual £?
  • sales revenue: budget £30,000 and actual £28,800

What is the sales price variance?

Select ONE answer:

  1. £1,200 adverse
  2. £1,200 favourable
  3. £1,800 adverse
  4. £1,800 favourable

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 – Actual price – Standard price * Actual quantity == > £28,800 / 1,800 = £16 == > £15 – £16 * 1,800 = £1,800 FAV

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