Davis Electronics expects to make 100,000 DVD players during 2012. Direct materials cost per unit are estimated at $18, and direct labor cost is expected to be $10 per unit. The total manufacturing overhead for the year is budgeted at $750,000.

Required

1) Calculate the amount of overhead that should be allocated to each DVD player during the year.

2) Assume that, during the month of October, Davis made and sold 7,000 DVD players. What would the cost of goods sold be for the month?

3) Assume that the company sells the DVD players at cost plus 25% of cost. What would be the selling price for each DVD player?