Question

113119 Te Ara Hill, Daniell Kaltin crombie National Corporation needs to set a target price for its newly designed product Use cost.plus pr R2-D2. The following data relate to this new product. determine vario (LO 2) Per Unit Total Direct materials Direct labor $16 Variable manufacturing overhead $ 7 Fixed manufacturing overhead $2,500,000 Variable selling and administrative expenses Fixed selling and administrative expenses $1,500,000 $ 8 $ 5 These costs are based on a budgeted volume of 100,000 units produced and sold each year. National uses cost-plus pricing methods to set its target selling price. The markup on total unit cost is 30%. Instructions (a) Compute the total variable cost per unit, total fixed cost per unit, and total cost per unit for R2-D2. (b) Compute the desired ROI per unit for R2-D2. (c) Compute the target selling price for R2-D2. (d) Compute variable cost per unit, fixed cost per unit, and total cost per unit assuming that 80,000 R2-D2s are produced sold during the year. (a) Variable co r : Bolivar Farm Supply Company manufactures and sells a fertilizer called Basic II. The following data are available for preparing budgets for Basic II for the first 2 quarters of 2017. Prepare budg statement an budgets. 101223

Answer 1

$ 36.00 total variable cost per unit $8 + $16 + $7 + $ 5 = total fixed cost per unit ($2,500,000 $1,500,0000) 100,000 $40.00 total fixed cost per unit $4,000,000 100,000 $76.00 total cost per unit $36 $40 = $22.80 desired ROI per unit $76 * 30% = b $98.80 target selling price $76 + $22.80 C $36.00 total variable cost per unit $8 + $16 + $7 + $ 5 = d total fixed cost per unit ($2,500,000 $1,500,0000) / 80,000 $50.00 total fixed cost per unit $4,000,000 / 80,000 $ 86.00 total cost per unit $36 $50