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Pricing Strategy, Sales Variances Eastman, Inc., manufactures and sells three products: R, 5, and T. In January, Eastman, Inc., budgeted sales of the following
Pricing Strategy, Sales Variances Eastman, Inc., manufactures and sells three products: R, 5, and T. In January, Eastman, Inc., budgeted sales of the following Budgeted Volume Budgeted Price Product R 116,100 $28 157,800 25 15,700 21 Product S Product T At the end of the year, actual sales revenue for Product R and Product S was $3,229,200 and $4,060,800, respectively. The actual price charged for Product R was $27 and for Product 5 was $24. Only $10 was charged for Product T to encourage more consumers to buy it, and actual sales revenue equaled $428,500 for this product. Required: 1. Calculate the sales price and sales volume variances for each of the three products based on the original budget. Product R Product S Product T Sales price variance Favorable Unfavorable Sales volume variance 2. Suppose that Product T is a new product just introduced during the year. What pricing strategy is Eastman, Inc., following for this product?)
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