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Cima P1 Exam Question No 58

Question No 58:

Why split sales volume variance to sales mix variance and sales quantity variance?Sales Volume Variance - Enables Management to identify contribution of sales team to acheive revised sales budget.
[Actual sales vol. - Budgeted sales vol.] × Budgeted Profit /unit

Sales Mix Variance - Enables management to see how much variance is due to actual sales mix differ from budgeted sales mix
[ Actual sales - Actual sales @ budget mix] × Budgeted Profit /unit

Sales Quantity Variance - Allows management to see how much variance is caused by difference between actual sales and budgeted sales.
[ Actual sales @ budget mix - Budgeted sales] × Budgeted Profit /unit

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