Good Inc. recently began production of a new product, a digital watch, which required the investment of $1,800,000 in assets. The costs of producing and selling 80,000 units of the digital watch are estimated as follows:

Variable Costs:

Per Unit

Direct Materials

$ 10.00

Direct Labor

$ 6.00

Factory Overhead

$ 4.00

Selling and Admin Expenses

$ 5.00

Total

$ 25.00

Fixed Costs:

Factory Overhead

$ 800,000

Selling and Admin Expenses

$ 400,000

Good Inc. is currently considering establishing a selling price for the digital watch. The president of Good Inc. has decided to use the cost-plus approach to product pricing and has indicated that the digital watch must earn a 10% rate of return on invested assets.

Determine the measures assuming that the product cost concept is used:

The amount of desired profit from the production and sale of the digital watch.

The cost amount per unit

The markup percentage

The selling price of the digital watch.