Ratliff Appliances Company makes a household appliance with model number RM$16.$ The goal for $2020$ is to reduce direct materials usage per unit. No defective units are currently produced. Manufacturing conversion costs depend on production capacity defined in terms of RM$16$ units that can be produced. The industry market size for appliances increased $10\%$ from $2019$ to $2020.$ The following additional data are available for $2019$ and $2020$:

$20192020$

Units Produced & Sold $33,00037,950$

Selling Price $ $360$ $ $345$

Direct Materials $($square feet$)82,50087,000$

Direct Material Costs per square foot $ $31$ $ $33$

Manufacturing capacity $($units$)41,25039,850$

Total Conversion Costs $ $866,250$ $ $797,000$

Conversion Costs per unit of capacity $ $21$ $ $20$

Compute the flexible$/$variable cost effect of the productivity component and indicate favorable or unfavorable.