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5- need to be answered correctly. please make sure both parts are answered. I will leave a like, thank you! Indigo Computer Parts Inc. is
5- need to be answered correctly. please make sure both parts are answered. I will leave a like, thank you!
Indigo Computer Parts Inc. is in the process of setting a selling price on a new component it has just designed and developed. The following cost estimates for this new component have been provided by the accounting department for a budgeted volume of 60,000 units. Per Unit Total Direct materials $40 Direct labor $21 Variable manufacturing overhead $16 Fixed manufacturing overhead $720,000 Variable selling and administrative expenses $15 Fixed selling and administrative expenses $480,000 Indigo Computer Parts management requests that the total unit cost be used in cost-plus pricing its products. On this particular product, management also directs that the target price be set to provide a 25% return on investment (ROI) on invested assets of $1,200,000. Compute the markup percentage and target selling price that will allow Indigo Computer Parts to earn its desired ROI of 25% on this new component. (Round markup percentage to 2 decimal places, e.g. 10.50%.) Markup percentage % Target selling price $ Assuming that the volume is 48,000 units, compute the markup percentage and target selling price that will allow Indigo Computer Parts to earn its desired ROI of 25% on this new component. (Round answers to 2 decimal places, e.g. 10.50 % or 10.50.) % Markup percentage Target selling price $ Step by Step Solution
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