Saturday, May 26, 2012

What is the total sales-quantity variance in terms of the contribution margin

ACCOUNTING

Multiple Choice

The XTRA Appliance Manufacturing Corporation manufactures two vacuum cleaners, the Standard and the Super. The following information was gathered about the two products:


Standard Super

Budgeted sales in units 3,200 800

Budgeted selling price $300 $850

Budgeted contribution margin per unit $210 $550

Actual sales in units 3,500 1,500

Actual selling price $325 $840


What is the total sales-quantity variance in terms of the contribution margin?

a. $110,000 favorable

b. $170,000 favorable

c. $278,000 favorable

d. $448,000 favorable

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