Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1. Smart Stream Inc. uses the total cost concept of applying the cost-plus approach to product pricing. The costs of producing and selling 8,000 units

1.

Smart Stream Inc. uses the total cost concept of applying the cost-plus approach to product pricing. The costs of producing and selling 8,000 units of cellular phones are as follows:

Variable costs: Fixed costs:
Direct materials $ 87 per unit Factory overhead $349,300
Direct labor 40 Selling and admin. exp. 122,700
Factory overhead 26
Selling and admin. exp. 21
Total $174 per unit

Smart Stream wants a profit equal to a 15% rate of return on invested assets of $1,018,990.

a. Determine the total costs and the total cost amount per unit for the production and sale of 8,000 units of cellular phones. Round the cost per unit to two decimal places.

Total costs $__________
Cost amount per unit $___________

b. Determine the total cost markup percentage (rounded to two decimal places) for cellular phones. __________%

c. Determine the selling price of cellular phones. Round to the nearest cent. $____________per phone

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Investment Grade Energy Audit Making Smart Energy Choices

Authors: Shirley J. Hansen, James W. Brown

1st Edition

0824709284, 978-0824709280

More Books

Students also viewed these Accounting questions

Question

Accounting and payroll fresher resume preparation Resumes

Answered: 1 week ago