Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

4. Merchandising Operations

Net Sales

Financial Accounting

4. Merchandising Operations

Net Sales

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Multiple Choice

Which of the following may cause a favorable sales volume variance of the revenues?

Budgeted sales returns are higher than actual sales returns.

Actual units sold are less than the budgeted units sold.

Actual selling price is lower than the budgeted selling price.

Actual units sold exceed the budgeted units sold.

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Verified step by step guidance

Step 1: Understand the concept of sales volume variance. Sales volume variance measures the difference between the budgeted sales volume and the actual sales volume, and it impacts the revenue. A favorable variance occurs when actual sales exceed budgeted sales.

Step 2: Analyze the options provided. Each option describes a scenario that could affect sales volume variance. Focus on identifying which scenario leads to a favorable variance.

Step 3: Evaluate the first option: 'Budgeted sales returns are higher than actual sales returns.' While lower actual sales returns may positively impact net revenue, this does not directly relate to sales volume variance.

Step 4: Evaluate the second option: 'Actual units sold are less than the budgeted units sold.' This scenario would result in an unfavorable sales volume variance because fewer units were sold than expected.

Step 5: Evaluate the fourth option: 'Actual units sold exceed the budgeted units sold.' This scenario directly leads to a favorable sales volume variance because selling more units than budgeted increases revenue.