Based upon the 2019 forecast information provided in Exhibit #4, what should Katherine charge a) for each truffle? b) for each chocolate piece? Markup as % of total cost (per Exhibit 4)) 35% Chocolate Pieces Calculate the following: Truffles Total Direct Costs (Exhibit 4) 130,440 131,500 Total Indirect Cost (per row 21) Total Cost # of forecasted units (per Exhibit 4) 120,000 40,000 Cost per piece Markup in dollars per unit Suggested selling price per unit EXHIBIT #4 Cost-Plus Pricing Calculation and Operating Profit Forecast - 2019 Truffles 120,000 Chocolate Pieces 40,000 Sales Volume (Units) Total 160,000 7,400 Direct Costs Owner's Salary Chocolate Butter Cream Flavour Extracts Moulds Sundry Appliances Electricity Total Direct Costs Direct Cost per Unit $ 67,500 $ 42,000 7,400 8,300 3,240 O 2,000 0 $ 130,440 $ $ 1.09 $ 22,500 $ 90,000 95,000 137,000 0 01 8,300 1,000 4,240 2,000 2,000 1,000 3,000 10,000 10,000 131,500 $ 261,940 3.29 $ Indirect Costs Property Taxes Building Depreciation Machine Depreciation Heating Electricity Employee Wages (2 people) Total Indirect Costs 19,500 20,000 7,000 2,400 2,400 51,000 102,300 Indirect Cost per Unit $ 0.64 Direct cost per unit Indirect cost per unit Total cost per unit Markup Percentage Markup in dollars Suggested Price (Note 1) Price Used (Note 2) Chocolate Truffles Pieces $ 1.09 $ 3.29 $ 0.64 $ 0.64 $ 1.73 $ 3.93 35% 35% $ 0.60 $ 1.37 $ 2.33 $ 5.30 $ 2.49 $ 5.00 Projected Sales Dollars 298,800 200,000 498,800 Projected Operating Profit 134,560 Notes: Note 1: Katherine has decided to use total cost plus pricing, calculated as follows: selling price = total cost per unit + (total cost per unit * markup percentage). Note 2: After reviewing the calculations of the suggested price, Katherine adjusted these slightly based on what she thought customers would be willing to pay