=+Inez Company recently began production of a new product, M, which required the investment of $1,600,000 in assets. The costs of producing and selling 80,000 units of Product M are estimated as follows:

Variable costs:
Direct materials $ 10.00 per unit Direct labor 6.00 Factory overhead 4.00 Selling and administrative expenses 5.00 _________ Total $ 25.00 per unit _________ _________ Fixed costs:
Factory overhead $800,000 Selling and administrative expenses 400,000 Inez Company is currently considering establishing a selling price for Product M.
The president of Inez Company has decided to use the cost-plus approach to product pricing and has indicated that Product M must earn a 10% rate of return on invested assets.
Instructions 1. Determine the amount of desired profit from the production and sale of Product M.