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could you please help me answer this question and show the steps . thank you :) Variable Cost Method of Product Pricing Smart Stream Inc.
could you please help me answer this question and show the steps . thank you :)
Variable Cost Method of Product Pricing Smart Stream Inc. produces and sells cell phones. The costs of producing and selling 4,500 units of cell phones are as follows: Variable costs: Fixed costs Direct materials $60 per unit Factory overhead $117,200 41,200 28 18 14 Direct labor Selling and admin. exp Factory overhead Selling and admin. exp Total variable cost per unit $120 per unit Smart Stream Inc. desires a profit equal to a 15% rate of return on invested assets of $420,000 Assume that Smart Stream Inc. uses the variable cost method of applying the cost-plus approach to product pricing a. Determine the variable costs and the variable cost amount per unit for the production and sale of 4,500 units of cellular phones Total variable cost Variable cost amount per unit b. Determine the variable cost markup percentage for cellular phones c. Determine the selling price of cellular phones. Round to the nearest cent. per cellular phoneStep by Step Solution
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