If an actual selling price is $400, an actual result is $250 and an actual units sold are 500, then selling price variance will be
A. $45,000
B. $55,000
C. $75,000
D. $65,000
Answer: Option C
Solution (By Examveda Team)
Selling price variance is calculated using the formula:Selling Price Variance = (Actual Selling Price - Actual Result) x Actual Units Sold
Given:
Actual Selling Price = $400
Actual Result = $250
Actual Units Sold = 500
Substituting the values:
Selling Price Variance = ($400 - $250) x 500
Selling Price Variance = $150 x 500
Selling Price Variance = $75,000
Therefore, the selling price variance will be $75,000.
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selling price variance=(actual selling price - actual result)*sold unit quantity
=(400$-250$)*500 unit.
= 750,000$
Please give explanation