Evaluating a decision to increase sales volume by reducing sales price At the beginning of its most recent accounting period, Jackora Company had planned to clean 400 house roofs at an average price of $250 per roof. By reducing the service charge to $225 per roof, the company was able to increase the actual number of roofs cleaned to 450.

Required

a. Determine the sales volume variance and indicate whether it is favorable (F) or unfavorable (U).

b. Determine the flexible budget variance and indicate whether it is favorable (F) or unfavorable (U).

c. Did reducing the price charged for cleaning roofs increase revenue? Explain.