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Flyer Company sells a product in a competitive marketplace. Market analysis indicates that its product would probably sell at $48 per unit. Flyer management desires
Flyer Company sells a product in a competitive marketplace. Market analysis indicates that its product would probably sell at $48 per unit. Flyer management desires a 12.5% profit margin on sales. Flyer's current full cost for the product is $44 per unit. If the company cannot cut costs any lower than they already are, the profit margin on sales to meet the market selling price would be a. 8.3% Ob. 7.3% Oc. 10.3% Od. 9.3% Mallard Corporation uses the product cost method of product pricing. Below is cost information for the production and sale of 45,000 units of its sole product. Mallard desires a profit equal to a 12% return on invested assets of $800,000. Fixed factory overhead cost $82,000 Fixed selling and administrative costs 45,000 Variable direct materials cost per unit 5.50 Variable direct labor cost per unit 7.65 Variable factory overhead cost per unit 2.25 0.90 Variable selling and administrative cost per unit The dollar amount of desired profit from the production and sale of the company's product is a. $105,840 Ob. $96,000 c. $220,500 Od. $225,000 Stryker Industries received an offer from an exporter for 20,000 units of product at $18 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data are available: Domestic unit sales price $24 Unit manufacturing costs: Variable 12 3 Fixed The differential cost from the acceptance of the offer is a. $360,000 b. $240,000 c. $60,000 d. $480,000
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