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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

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 104,800 $28
Product S 150,000 23
Product T 20,900 23

At the end of the year, actual sales revenue for Product R and Product S was $2,921,400 and $3,601,400, respectively. The actual price charged for Product R was $27 and for Product S was $22. Only $13 was charged for Product T to encourage more consumers to buy it, and actual sales revenue equaled $722,150 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 $ Favorable
Product S $ Unfavorable $ Favorable
Product T $ Unfavorable $ Favorable

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