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Sales Variance Formulas

This document outlines formulas for calculating various sales variances, including: 1) Sales-volume variance compares actual quantity sold to budgeted quantity sold multiplied by the budgeted cost per unit. 2) Sales-quantity variance compares actual total quantity sold to budgeted total quantity sold using budgeted sales mix percentages and cost per unit. 3) Sales-mix variance compares the difference between actual and budgeted sales mix percentages multiplied by actual quantity sold and budgeted cost per unit.

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2K views1 page

Sales Variance Formulas

This document outlines formulas for calculating various sales variances, including: 1) Sales-volume variance compares actual quantity sold to budgeted quantity sold multiplied by the budgeted cost per unit. 2) Sales-quantity variance compares actual total quantity sold to budgeted total quantity sold using budgeted sales mix percentages and cost per unit. 3) Sales-mix variance compares the difference between actual and budgeted sales mix percentages multiplied by actual quantity sold and budgeted cost per unit.

Uploaded by

tastyel
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Chapter 14 - Sales Variance Formulas

Sales-Volume Variance = (Actual Quantity - Budgeted Quantity) x Budgeted CM


u
Sales-Quantity Variance = [Actual Quantity (all) - Budgeted Quantity (all)] x Budgeted Sales Mix % x Budgeted CM
u
Sales-Mix Variance
= (Actual Sales Mix % - Budgeted Sales Mix %) x Actual Quantity (all) x Budgeted CM
u
Market-Size Variance = (Actual Market Size - Budgeted Market Size) x Budgeted Market Share x BACM
u
Market-Share Variance = (Actual Market Share - Budgeted Market Share) x Actual Market Size x BACM
u
Alternative calculations:
*** Per request:
Formula for calculating Sales-Quantity Variance using market size and market share
Sales-Quantity Variance = [(Actual Market Size x Actual Market Share) - (Budgeted Market Size x Budgeted Market Share)]
x BACM
u
Sales-Mix Variance Sales-Quantity Variance
Sales-Quantity Variance
x Actual Sales Mix x Budgeted Sales Mix x Budgeted Sales Mix
x Budgeted CM
u
x Budgeted CM
u
x Budgeted CM
u
Flexible Budget: Static Budget:
Actual Quantity Sold (all) Actual Quantity Sold (all) Budgeted Quantity Sold (all)
Sales-Volume Variance
Market-Share Variance Market-Size Variance
x Budgeted Average CM
u
x Budgeted Average CM
u
x Budgeted Average CM
u
Static Budget:
Actual Market Size Actual Market Size Budgeted Market Size
x Actual Market Share x Budgeted Market Share x Budgeted Market Share

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