(Revenue variances) “Babies Doing Funny Stuff’ is a videotape series that is mar¬ keted to day care centers and parents. The series has been found to make babies who watch it extremely content and quiet. In 1996, Angels Ftd., maker of the tapes, sold 400 of the series for $60 per package. In preparing the 1997 budget, company management estimated a 15 percent increase in sales volume because the price was to be reduced by 10 percent. At the end of 1997, company man¬ agement is disappointed that actual revenue is only $24,440 although 470 pack¬ ages of the series were sold.

a. What was the expected revenue for 1997?

b. Calculate the price and volume variances for Angels Ftd.