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Cheyenne Computer Parts Inc. is in the process of setting a selling price on a new component it has just designed and developed. The following
Cheyenne 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 44,000 units. Per Unit Total $44 $25 $20 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and administrative expenses $528,000 $19 $352,000 Cheyenne 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 $880,000 Compute the markup percentage and target selling price that will allow Cheyenne Computer Parts to earn its desired ROI of 25% on this new component. (Round markup percentage to 2 decimal places, eg. 10.50%) Markup percentage Target selling price $ e Textbook and Media Save for Later Attempts:0 of 3 used Submit
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