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Canton Company produces and sells toasters. The following unit cost information assumes a production and sales volume of 16,000 units: Direct materials Direct labor
Canton Company produces and sells toasters. The following unit cost information assumes a production and sales volume of 16,000 units: Direct materials Direct labor $11.50 8.50 Variable overhead i 2.50 Fixed overhead 3.50 Variable selling and administrative costs Fixed selling and administrative costs 6.00 5.00 Required: a. Compute the budgeted selling price per unit assuming Canton uses a cost-plus pricing strategy and a markup equal to 75% of production cost. Note: Round your answer to 2 decimal places. b. Compute the firm's total fixed costs. c. Compute the firm's contribution margin per unit given the budgeted selling price you computed in Requirement 1. Note: Round your answer to 2 decimal places. d. Compute the firm's break-even point in units and dollars, using the selling price you calculated in Requirement 1. e. Using the unit contribution margin, compute the firm's estimated profit if 16,000 units are sold. a Budgeted selling price b. Total fixed costs per unit c. Contribution margin d Break-even point d Break-even sales i le Estimated profit per unit units
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