GIVEN: Kann Corporation produces industrial robots for high-precision manufacturing. The following information is available:

Per Unit Total

Direct materials $25.00

Direct labor $10.00

Variable manufacturing overhead $6.00

Fixed manufacturing overhead $36,000

Variable selling and administrative costs $4.00

Fixed selling and administrative costs $15,000

The company has a desired ROI of 20%. It has invested assets of $420,000. It anticipates making and selling 3,000 units per year.

REQUIRED:

Part 1: Using the total (full) cost concept, determine the (a) unit cost amount; (b) markup percentage; and (c) unit target selling price.

Part 2: Using the product (absorption) cost concept, determine the (a) unit cost amount; and (b) markup percentage.

Part 3: Using the variable cost concept, determine the (a) unit cost amount; and (b) markup percentage.

Part 4: What is the target unit selling price under the three cost assumptions?

Part 5: What else should be considered when setting the product's selling price?

Part 6: Which of the three costing concepts would be most appropriate in each of the following situations? 1. External reporting for GAAP 2. Normal (long-run) pricing 3. Evaluating special orders

Part 7: Kann Corporation received a special order for 500 robots at $50 each from a foreign customer. Acceptance of the order would increase variable selling costs by $1.70 per unit because of shipping costs, but would not increase fixed costs or interfere with any current orders. Prepare a differential analysis to determine whether the special order should be accepted or not.

My school has no tutors for this; I will post what little I have, and attempt more myself, but I really do not know what I'm doing. I do not know how these figures that I have were determined:

			Full cost for 3000 units			Absorption cost for 3000 units			Variable costs for 3000 units
Direct materials			$75,000			$75,000			$75,000
Direct labor			30,000			30,000			30,000
Variable manufacturing overhead			18,000			18,000			18,000
Fixed manufacturing overhead			36,000			36,000
Variable selling overhead			12,000						12,000
Fixed selling overhead			15,000
Total cost			186,000			159,000			135,000
Cost per unit			62			53			45
Desired profit = 42,000 * 20%			84,000			84,000			84,000
Sales value			270,000			243,000			219,000
Sales price per unit			90			81			73