Crystal Displays Inc. recently began production of a new product, flat panel displays, which required the investment of $1,500,000 in assets. The costs of producing and selling 5,000 units of fat panel displays are estimated as follows: Variable costs per unit: $122.00 ? 5 Direct materials Direct labor 7800 4800 Factory overhead Selling and administrative expenses 5 34,00 Total $232.00 Fixed costs: Factory overhead Selling and administrative expenses $245,000.00 148,000.00 Crystal Displays Inc. is currently considering establishing a selling price for flat panel displays. The president of Crystal Displays has decided to use the cost-plus approach to product pricing and has indicated that the displays must earn a 13% rate of return on invested assets. Required: 1 Determine the amount of desired profit from the production and sale of flat panel displays 2. Assuming that the product.cost conceat is used determine (a) the cost amount per unit, (b) the wkup percentage (rounded to two de Crystal Displays Inc. is currently considering establishing a selling price for flat panel displays. The president of Crystal Displays has decided to use the a indicated that the displays must earn a 13% rate of return on invested assets. B Required: 1. Determine the amount of desired profit from the production and sale of flat panel displays 2. Assuming that the product cost concert is used, determine (a) the cost amount per unit, (b) the markup (rounded to two decimal places), and (c) the selling price of flat panel displays 3. (Appendix) Assuming that the total cost concept is used determine (a) the cost amount per unit (b) markup percentage (rounded to two decimal places), and (c) the selling price of flat panel displays. BE ntage (rounded to two 4. (Appendix) Assuming that the variable cost concept is used, determine (a) the cost amount per unit (b) decimal places), and (c) the selling price of flat panel displays 5. Comment on any additional considerations that could influence establishing the selling price for flat panel displays. 6. Assume that as of August 1, 3,000 units of flat panel displays have been produced and sold during the current year. Analysis of the domestic market indicates that 2,000 additional units are expected to be sold during the remainder of the year at the normal product price determined under the product cost concept. On August 3, Crystal Displays Inc. received an offer from Maple Leaf Visual Inc. for 1.000 units of flat panel displays at $220 each. Maple Leaf Visual Inc. will market the units in Canada under its own brand name, and no variable selling and administrative expenses associated with the sale will be incurred by Crystal Displays Inc. The additional business is not expected to affect the domestic sales of flat panel displays, and the additional units could be produced using existing factory, selling, and administrative capacity A. Prepare a differential analysis of the proposed sale to Maple Leaf Visual Inc. Refer to the lists of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. For those boxes in which you must enter subtracted or negative numbers use a minus sign. If there is no amount or an amount is zero, enter"0" A colon () will automatically appear if required B. Based on the differential analysis in part (A), should the proposal be accepted? /takeAssignmerg lakerJJIY eBook Calculator E Print Item exact wording of the answer choices for text entries. For those sign. If there is no amount or an amount is zero, enter "0". A col B. Based on the differential analysis in part (A), should the propos Labels and Amount Descriptions Labels Cash flows from operating activities Costs Amount Descriptions Cash payments for merchandise Cash received from customers Fixed manufacturing costs Income (Loss). per unit Revenues Variable manufacturing costs Starting Questions 1. Determine the amount of desired profit from the production and sale of flat pa Printem Starting Questions 1. Determine the amount of desred proff from the production and s o far panel displays 2. Assuming that the product cost concernedetermine the cost amount per unt, the markup percentage rounded to two decimal places and the song price of fat panel displays $ Cost amount per unit Markup percentage Selling price amount par unt, the markup percentage grounded to be decimal places and the sing price of the panel 3. (Appendix) Assuming that the display Cost amount per un Markup percentage Seling price Aspen Asuming the me the cost amount per with a perd a dece of a per Cost amount per Marko percentage Seling price 5 Comment on any additional considerations that could influence establishing the selling price for flat panel displays The cost plus approach price of $360 general economic conditions of the marketplace be viewed as a general guideline for establishing long run normal prices Other considerations, such as the price of competing products and lead management to establish a shortcun price more or less than Diferential Analysis 6. A. Prepare a differential analysis of the proposed sale to Maple Leaf Visualine. Refer to the list of Labels and Amount Descrptions for the exact wording of the answer choices for text entries. For those boxes in which you must enter subtracted or negative numbers use a minus sign. If there is no amount or an amount is 200, e o Acolon() w automatically appear if required Differential Analysis Reject Order (Alternative 1) or Accept Order (Alternative 2) August Reject Order Accept Order Alternative 1) Alternative 2) (Alternative 20 Final Question 6. B. Based on the differential analysis in part (A), should the proposal be accepted? No The company is indifferent since the result is the same regardless of which alternative is chosen Yes