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the marketing manager of hodgson industrial design estimates that the company can se 665059

The marketing manager of Hodgson Industrial Design estimates that the company can sell a green widget for $80 per unit during the upcoming year. This estimate is based on the historical demand for green widgets.

During the first half of the new year, the price of the green widget comes under extreme pressure as a new supplier in Ireland floods the market with a lower priced green widget. Hodgson must drop its price to $70 in order to compete, and sells 20,000 units during that period. Its selling price variance during the first half of the year is:

($70 Actual price $80 Budgeted price) x 20,000 units = $(200,000) Selling price variance

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