What is the Sales Volume Variance under 4-way analysis?
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Sammy Inc. wants to analyze the variances in its actual and budgeted gross profit. The following are available:
Actual gross profit and actual gross profit ratio is P600,000 and 25%, respectively.
• The actual sales are P400,000 more than the total budgeted sales.
Budgeted sales price at actual quantity sold is P2,000,000
What is the Sales Volume Variance under 4-way analysis?
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