Question

Garcia Co. sells snowboards. Each snowboard requires direct materials of $109, direct labor of $39, and variable overhead of $54. The company expects fixed overhead costs of $653,000 and fixed selling and administrative costs of $110,000 for the next year. It expects to produce and sell 10,900 snowboards in the next year. What will be the selling price per unit if Garcia uses a markup of 10% of total cost? (Round your answer to 2 decimal places.) Selling price Per Unit

Answer 1

Calculate selling price per unit as follows: Particulars 2 Fixed overhead cost 3 Fixed selling and administrative costs 4 Total fixed cost 5 Total number of units 6 Fixed cost per unit Amount $6,53,000 $ 1,10,000 $7,63,000 $ 10,900 $ 70 S 109 8 Direct materials cost 9 Direct Labor cost 10 Variable overhead cost 11 Fixed cost 12 Total cost per unit 13 Markup % of total cost 14 Selling Price per unit s 70 10% S 299.20 Calculations: А B Particulars Amount 2 Fixed overhead cost 653000 3 Fixed selling and administrative costs 110000 4 Total fixed cost =B2+B3 5 Total number of units 10900 6 Fixed cost per unit =B4/B5 8 Direct materials cost 9 Direct Labor cost 10 Variable overhead cost 11 Fixed cost 12 Total cost per unit 13 Markup % of total cost 14 Selling Price per unit 109 39 54 70 =B8+B9+B10+B11 0.1 =B12*(1+B13) For any queries or doubts related to format or any values please post in comment section, I would take that up