Compute the revenue effect of growth in year
Wilderness Travels Bicycle Company’s had a change in management. The new managerial accountant reviews the variance in units sold in 2011 compared to 2012 to assess the revenue effect of growth that occured in sales volume. In 2011, 2,460,000 units were sold; and 2,632,000 were sold in 2012, while the price per unit is set at $69.99.
1 – Compute the revenue effect of growth in 2011 and 2012. Indicate whether the differences is a favorable, F, or unfavorable, U, variance.