Sales-Volume Variances
Keep in mind that the flexible-budget amounts in column 3 of Exhibit 7-2 and the
static-budget amounts in column 5 are both computed using budgeted selling prices,
budgeted variable cost per jacket, and budgeted fixed costs. The difference between
the static-budget and the flexible-budget amounts is called the sales-volume variance
because it arises solely from the difference between the 10,000 actual quantity (or volume)
of jackets sold and the 12,000 quantity of jackets expected to be sold in the
static budget.