Conquest, Inc. produces a special kind of

lightweight,

recreational vehicle that has a unique design. It allows the company to follow a

costplus

pricing strategy. It has $10,000,000 of average assets, and the desired profit is a 7% return on assets. Assume all products produced are sold. Additional data are as follows:

Sales volume	2000	units per year
Variable costs	$1000	per unit
Fixed costs	$4,000,000	per year

Using the

costplus

pricing approach, what should be the sales price per unit?

Question content area bottom

Part 1

A.

$8,000

B.

$1,070

C.

$3,350

D.

$1,000