Which is NOT a reason for a static budget variance?
A) Actual sales volume was higher than projected sales volume.
B) Actual variable costs were higher than static budget variable costs.
C) Actual fixed costs were higher than static budget fixed costs.
D) Actual sales volume in current period was higher than projected sales volume in last period.

Question

Quizplus · Accepted Answer

Actual sales volume in a current period being higher than projected sales volume in the last period is not a reason for a static budget variance because the static budget is prepared for the current period based on projected figures, not previous period figures. Variance arises when actual results differ from the budgeted figures for a given period, which can occur due to differences in actual sales revenue, variable and fixed costs, and other factors. However, comparing actual sales volume in the current period with projected sales volume in the last period is not relevant to the static budget variance analysis.

Which Is NOT a Reason for a Static Budget Variance