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 Budgeted Volume Price Product R $26 103,300 Product S 149,800 20 Product T 15,400 23 At the end of the year, actual sales revenue for Product R and Product S was $2,667,500 and $3,087,500, respectively. The actual price charged for Product R was $25 and for Product S was $19. Only $13 was charged for Product T to encourage more consumers to buy it, and actual sales revenue equaled $551,200 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 Sales volume variance Product R Unfavorable v Favorable v 106,700 162,500 V Unfavorable v Favorable v Product S 42,400 x Unfavorable v $4 Product T Favorable v 2. Suppose that Product T is a new product just introduced during the year. What pricing strategy is Eastman, Inc., following for this product? Penetration pricing strategy v Feedback V Check My Work 1. For a price variance you will find price data within the parentheses of the formula: actual price versus expected price. For a volume variance you will find volume within the parentheses of the formula: actual volume versus expected volume. 2. Is it penetration pricing, price skimming or price gouging