The Crockery Pottery Company Completed the Flexible Budget Analysis for the Second

Multiple Choice

The Crockery Pottery Company completed the flexible budget analysis for the second quarter,which is given below. $\begin{array}{|l|c|c|c|c|c|c|c|}\hline && \text { Flexible } & & &\text { Sales } & \\&\text { Actual } &\text { Budget } & &\text { Flexible } & \text { Volume } & &\text { Static } \\&\text { Results } & \text { Variance } & &\text { Budget } & \text { Variance } & &\text { Budget } \\\hline \text { Units } & \underline{12,900} & \underline{0} & & \underline{12,900} & \underline{1100} &\underline{F} & \underline{11,800}_{} \\\hline \text { Sales Revenue } & \$ 62,710 & \$ 2894 & { U } & \$ 65,604 & \text { \$5594}&{F } & \$ 60,010 \\\hline \text { Variable Costs } & \underline{27,580} & \underline{13} & \underline{ U } &\underline{ 27,593} & \underline{\$ 2353} &\underline{U}_{} & \underline{25,240}_{} \\\hline \text { Contribution Margin } & \$ 35,130 & \$ 2881 & { U } &\$ 38,011 & \$ 3241& {F} & \$ 34,770 \\\hline \text { Fixed Costs } & \underline{34,240} & \underline{150} & \underline{U} & \underline{34,090} & \underline{\$ 0} & &\underline{34,090}\\\hline \begin{array}{l}\text { Operating } \\\text { income/(Loss) }\end{array} & \underline{\$890} & \underline{\$ 3031} & \underline{ U } & \underline{\$ 3921} & \underline{\$3241} &\underline{F} & \underline{\$680}\\\hline\end{array}$ Which of the following would be a correct factor to explain the sales volume variance for sales revenue?

A) increase in sales price per unit
B) increase in sales volume
C) increase in variable cost per unit
D) increase in fixed costs