Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Brexit Pty Ltd manufactures items for politicians. They are planning to introduce a new product, called the 'Right-wing'. Current plans require production and sale of
Brexit Pty Ltd manufactures items for politicians. They are planning to introduce a new product, called the 'Right-wing'. Current plans require production and sale of 1000 products with estimated production costs as follows. Variable costs: Manufacturing $450 000 Selling and administrative $100 000 Total variable costs $550 000 Fixed costs: Manufacturing $300 000 Selling and administrative $180 000 Total fixed costs $480 000 Total costs $1 030 000 The average amount of capital invested in the new product is $900 000 and Brexit's target return on investment for it is 18 per cent. What price must Brexit charge if the company uses cost-plus pricing based on total variable cost? Select one: O $1930 $1030 O $1192 O $712
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started