Final answer:
The difference between budgeted and actual units sold results in a sales activity variance, which highlights how the actual sales volume differs from the expected volume and its impact on revenues. Option B is correct.
Step-by-step explanation:
A difference between the number of budgeted units sold and actual units sold results in a sales activity variance. This type of variance reflects the impact on revenues or contributions due to the difference in the quantity of units sold. It is essential in budgeting and variance analysis as it helps businesses understand how the actual performance compares to the budgeted expectations related to sales volume.
For example, if a company planned to sell 100 units at $10 each, the budgeted sales revenue would be $1,000. If the actual units sold were 90 units, at the same price, the actual sales revenue would be $900. Here, the sales activity variance would be $100 unfavorable, since the actual sales are less than budgeted sales by 10 units, resulting in lower revenue.
The difference between the number of budgeted units sold and actual units sold results in a sales activity variance.
In accounting, sales activity variance measures the difference between the expected and actual level of activity, such as the quantity of units sold. It helps in analyzing the performance of a business by comparing the budgeted sales with the actual sales.
For example, if a company budgeted to sell 100 units but actually sold 90 units, the sales activity variance would be negative, indicating a shortfall in sales performance.