Green Gables Company....

Green Gables Company makes a product that has the following costs: Per unit Per year Direct materials $17.30 Direct labour 12.90 Variable manufacturing 4.20 overhead Fixed manufacturing overhead $916,800 Variable SG&A expenses 2.00 Fixed SG&A expenses 907,200 The company uses the absorption costing approach to cost-plus pricing. The pricing calculations are based on budgeted production and sales of 48,000 units per year. The company has invested $360,000 in this product and expects a return on investment of 15%. Required: 1. Compute the markup on absorption cost. 2. Compute the target selling price of the product using the absorption costing approach