A machine distributor sells two models, basic and deluxe. The following information relates to its master budget.
$$\begin{array} { l c c }
& \text { Basic } & \text { Deluxe } \
\text { Sales (units) } & 8,000 & 2,000 \
\text { Sales price per unit } & \$ 8,000 & \$ 12,000 \
\text { Variable costs per unit } & \$ 6,400 & \$ 9,000
\end{array}$$
Actual sales were 7,000 basic models and 2,800 deluxe models. The actual sales prices were the same as the budgeted sales prices for both models.
-
What is the sales activity variance for the deluxe model?
A) $400,000.
B) $800,000.
C) $1,600,000.
D) $2,400,000.

Question

A machine distributor sells two models, basic and deluxe. The following information relates to its master budget.
$$\begin{array} { l c c } 
& \text { Basic } & \text { Deluxe } \
\text { Sales (units) } & 8,000 & 2,000 \
\text { Sales price per unit } & \$ 8,000 & \$ 12,000 \
\text { Variable costs per unit } & \$ 6,400 & \$ 9,000
\end{array}$$
Actual sales were 7,000 basic models and 2,800 deluxe models. The actual sales prices were the same as the budgeted sales prices for both models.
-
What is the sales activity variance for the deluxe model?
A) $400,000.
B) $800,000.
C) $1,600,000.
D) $2,400,000.

Quizplus · Accepted Answer

The Answer of A machine distributor sells two models, basic and deluxe. The following information relates to its master budget.
$$\begin{array} { l c c } 
& \text { Basic } & \text { Deluxe } \
\text { Sales (units) } & 8,000 & 2,000 \
\text { Sales price per unit } & \$ 8,000 & \$ 12,000 \
\text { Variable costs per unit } & \$ 6,400 & \$ 9,000
\end{array}$$
Actual sales were 7,000 basic models and 2,800 deluxe models. The actual sales prices were the same as the budgeted sales prices for both models.
-
What is the sales activity variance for the deluxe model?
A) $400,000.
B) $800,000.
C) $1,600,000.
D) $2,400,000.

A Machine Distributor Sells Two Models, Basic and Deluxe Actual Sales Were 7,000 Basic Models and 2,800 Deluxe Models