Question
Exercise 18.20 (Algorithmic) Pricing Strategy, Sales Variances Eastman, Inc., manufactures and sells three products: R, S, and T. In January, Eastman, Inc., budgeted sales of
Exercise 18.20 (Algorithmic) Pricing Strategy, Sales Variances
Eastman, Inc., manufactures and sells three products: R, S, and T. In January, Eastman, Inc., budgeted sales of the following.
Budgeted Volume | Budgeted Price | |
---|---|---|
Product R | 118,300 | $25 |
Product S | 164,400 | 20 |
Product T | 16,600 | 21 |
At the end of the year, actual sales revenue for Product R and Product S was $2,935,200 and $3,382,000, respectively. The actual price charged for Product R was $24 and for Product S was $19. Only $11 was charged for Product T to encourage more consumers to buy it, and actual sales revenue equaled $485,100 for this product.
Required:
1. Calculate the sales price and sales volume variances for each of the three products based on the original budget.
Sales Price Variance
Product R | 122300 | Unfavorable |
Product S | 178000 | Unfavorable |
Product T | _____?_____ | Unfavorable |
Sales Volume Variance
Product R | ____?___ | Favorable |
Product S | ____?____ | Favorable |
Product T | ____?____ | Favorable |
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