What is the sales quantity variance for the basic model?
A)$120,000
B)$256,000
C)$1,344,000
D)$1,600,000

Question

Quizplus · Accepted Answer

Sales quantity variance = (Budgeted sales quantity - Actual sales quantity) x Standard contribution margin per unit
For the basic model, the sales quantity variance = (20,000 - 15,000) x $17.07 = $85,350. 
However, the question asks for the variance in total sales dollars, so we need to multiply this by the selling price: $85,350 x $3.00 = $256,050, which rounds to option B.

What Is the Sales Quantity Variance for the Basic Model