Question

When would a sales price variance be listed as unfavorable?

a. When the actual sales price is equal to the standard sales price
b. When the actual sales volume is less than the budgeted sales volume
c. When the actual sales price is greater than the standard sales price
d. When the actual sales price is less than the standard sales price

Answer 1

A sales price variance is listed as unfavorable when the actual sales price is less than the standard sales price. Therefore, the correct option is D.

Step-by-step explanation:

The correct answer is d. When the actual sales price is less than the standard sales price. A sales price variance is a measure of the difference between the actual sales price and the standard sales price. When the actual sales price is less than the standard sales price, it indicates that the company is selling its products at a lower price than anticipated, resulting in a negative impact on profitability.