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2. Boston Executive, Inc., produces executive limousines and currently manufactures the mini- bar inset at these costs: Variable Costs: Direct materials Direct labor Variable overhead
2. Boston Executive, Inc., produces executive limousines and currently manufactures the mini- bar inset at these costs: Variable Costs: Direct materials Direct labor Variable overhead Total variable costs Variable Cost Fixed Costs: Amount: $950 Depreciation - equipment 650 Depreciation - building 300 Supervisor salaries 1,900 Total Fixed costs Fixed Cost Amount: $500 200 300 1,000 Assume that Boston Executive, Inc. uses the variable cost method of applying the cost-plus approach to product pricing. a. Determine the variable costs and the variable cost amount per unit for the production and sale of 1,000 mini-bars. b. Determine the variable cost markup percentage (rounded to two places behind the decimal) for mini-bars. c. Determine the selling price of mini-bars. (Round markup to the nearest cent.)
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