5. Diedrich Corporation makes a product with the following costs:

	Per Unit	Per Year
Direct materials	$ 18.70
Direct labor	$ 12.00
Variable manufacturing overhead	$ 4.50
Fixed manufacturing overhead		$ 862,500
Variable selling and administrative expenses	$ 1.00
Fixed selling and administrative expenses		$ 850,000

The company uses the absorption costing approach to cost-plus pricing described in the text. The pricing calculations are based on budgeted production and sales of 75,000 units per year.

The company has invested $450,000 in this product and expects a return on investment of 14%.

Direct labor is a variable cost in this company.

The markup on absorption cost is closest to: (Round your intermediate calculations to 2 decimal places and final answer to 1 decimal place.)

6. Magney, Incorporated, uses the absorption costing approach to cost-plus pricing described in the text to set prices for its products. Based on budgeted sales of 28,000 units next year, the unit product cost of a particular product is $62.50. The company's selling and administrative expenses for this product are budgeted to be $826,000 in total for the year. The company has invested $540,000 in this product and expects a return on investment of 11%.The selling price for this product based on the absorption costing approach would be closest to: (Do not round intermediate calculations.)