The Comfort Foam Products Company Completed the Flexible Budget Analysis

Multiple Choice

The Comfort Foam Products Company completed the flexible budget analysis for the second quarter,which is given below. $\begin{array}{|l|c|c|c|c|c|c|c|}\hline && \text { Flexible } & & &\text { Sales } & \\&\text { Actual } &\text { Budget } & &\text { Flexible } & \text { Volume } & &\text { Static } \\&\text { Results } & \text { Variance } & &\text { Budget } & \text { Variance } & &\text { Budget } \\\hline \text { Units } & \underline{12,830} & \underline{0} && \underline{12,830} & \underline{930} &\underline{\mathrm{F}} & \underline{11,900}_{} \\\hline \text { Sales Revenue } & \$ 62,760 & \$ 1983 &\mathrm{U} & \$ 64,743 & \$ 4693 &\mathrm{F} & \$ 60,050 \\\hline \text { Variable Costs } & \underline{27,610} & \underline{397} &\underline{\mathrm{U} } & \underline{27,213} & \underline{\$ 1973} &\underline{\mathrm{U}} & \underline{25,240}_{} \\\hline \text { Contribution Margin } & \$ 35,150 & \$ 2380 &\mathrm{U} & \$ 37,530 & \$ 2720& \mathrm{~F} & \$ 34,810 \\\hline \text { Fixed Costs } & \underline{34,270} & \underline{190} &\underline{\mathrm{U}} & \underline{34,080} & \underline{\$ 0}& & \underline{ 34,080 }_{} \\\hline \begin{array}{l}\text { Operating } \\\text { income/(Loss) }\end{array} & \underline{\$ 880} & \underline{\$ 2570} &\underline{\mathrm{U}} & \underline{\$ 3450} & \underline{\$2720} &\underline{\mathrm{F}} & \underline{\$730}\\\hline\end{array}$ Which of the following would be a correct factor to explain the sales volume variance for variable costs?

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