The following information is available:

Flexible-budget variance = $120,000 (F), sales-quantity variance = $250,000 (F), sales-mix variance = $300,000 (F),market-size variance = $80,000 (U).

Required:

(a) Calculate the sale-volume variance and clearly indicate whether the variance is favourable (F) or unfavourable (U). Show all workings; and

(b) Provide a brief interpretation of this variance.