Question

Farad. Inc., specializes in selling used SUVs. During the month, the dealership sold 50 trucks at an average price of $9,000 each. The budget for the month was to sell 45 trucks at an average price of $9,500 each. AQ = Actual Quantity SQ = Standard Quantity AP = Actual Price SP = Standard Price Compute the dealership's sales price variance and sales volume variance for the month.

Answer 1

Answer:

Instructions are listed below.

Explanation:

Giving the following information:

The dealership sold 50 trucks at an average price of $9,000 each. The budget for the month was to sell 45 trucks at an average price of $9,500 each.

Sales price variance= (standard price - actual price)*actual quantity

Sales price variance= (9,000 - 9,500)*50= 25,000 favorable

Sales quantity variance= (standard quantity - actual quantity)*standard price

Sales quantity variance= (50 - 45)*9,000= 45,000 unfavorable