A "Target" Price and Profit.

The following data relate to the Howle Manufacturing Corporation for 20x2.

Sales (30,000 units)............... $ 450,000 Returns, allowances, and discounts 13,500 NeR Sailer ort & IO Ccinns daar Westra $43 6,500 Gost of gdods'sold’.3 ie eo 306,000 Gross Profits og Vane, «aR TP are, $ 130,500 Selling Expenses ................. $ 60,000 Administrative expenses ........... 30,000 90,000 Net income (before income taxes) ... $ 40,500 The budget committee has estimated the following changes in income and costs for 20x3:

30% increase in number of units sold.

20% increase in material unit cost.

15% increase in direct labor cost per unit.

10% increase in production overhead cost per unit.

14% increase in selling expenses.

7% increase in administrative expenses.

As inventory quantities remain fairly constant, the committee considered that, for budget purposes, any change in inventory valuation can be ignored. The composition of the cost of a unit of finished product during 20x2 for direct materials, direct labor, and manufacturing overhead, respectively, was in the ratio of 3 to 2 to 1. Production overhead and selling expenses are expected to be 50 percent fixed, and administrative expenses are normally 100 percent fixed. No changes in production methods or credit policies are contemplated for 20x3.

Required:
Compute the unit sales price (adjusted to the nearest full cent) at which the Howle Corporation must sell its only product in 20x3 in order to earn a budgeted income (before income taxes) of $60,000.