(Appendix 11A)Wanda's Wand Shop sells a variety of magic wands. In a recent month, Wanda's accounting information system revealed the following information:
Budget Actual
Units 2,500 3,200
Sales revenue $10,000 $12,000
Variable product costs 1,200 2,000
Fixed manufacturing costs 800 700
Variable selling costs 1,500 1,400
Fixed nonmanufacturing costs 500 600
a)Calculate the following variances:
Revenue budget variance
Sales price variance
Revenue sales quantity variance
b)Suggest two reasons why managers might be interested in investigating one or more of the variances in part (a).

Question

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The Answer of (Appendix 11A)Wanda's Wand Shop sells a variety of magic wands. In a recent month, Wanda's accounting information system revealed the following information:
Budget Actual
Units 2,500 3,200
Sales revenue $10,000 $12,000
Variable product costs 1,200 2,000
Fixed manufacturing costs 800 700
Variable selling costs 1,500 1,400
Fixed nonmanufacturing costs 500 600
a)Calculate the following variances:
Revenue budget variance
Sales price variance
Revenue sales quantity variance
b)Suggest two reasons why managers might be interested in investigating one or more of the variances in part (a).

(Appendix 11A)Wanda's Wand Shop Sells a Variety of Magic Wands