A company had a standard sales price of $1.79 per unit and expected to sell 10,000 units. Due to a downturn in the economy, the product was marked down to $1.59 per unit and the company only sold 9,500 units. Calculate the sales price variance.

Sales price variance = $1,900.

Explanation:

We know,

Sales price variance = (Standard sales price - Actual sales price) * Actual sales quantity

Given,

Standard sales price = $1.79 per unit.

Actual sales price = $1.59 per unit.

Actual sales quantity = 9,500 units.

Putting the values into the formula, we can get

Sales price variance = (Standard sales price - Actual sales price) * Actual sales quantity

or, Sales price variance = ($1.79 - $1.59) * 9,500

or, Sales price variance = $0.2 * 9,500

or, Sales price variance = $1,900.