Sara's Systems manufactures audio systems for cars. Two models are produced: The Standard model has a budgeted price of $200 and a standard variable cost of $80. The Blaster model has a budgeted price of $480 and a standard variable cost of $160. At the beginning of the year, Sara estimated that she would sell 7,500 Blaster models and 22,500 Standard models.
The actual results for the year showed that 7,200 Blaster models were sold for total revenues of $3,024,000. A total of 26,400 Standard models were sold for revenues of $5,544,000.
Required
a. Compute the activity variance for the year.
b. Compute the mix and quantity variances for the year.