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Exercise 12A-6 Velue-Based Pricing; Absorption Costing Approoch to Cost-Plus Pricing [LO 12-8), ILO 12 sting Approach to Cost-Plus Pricing [LO 12-8], [LO 12- 10) has developed a new industrial piece of equipment called the XP 200. The company is considering two methods of establishing a selling price for the XP-200-absorption cost plus pricing and valuebased pricing Valmont's cost accounting system reports an absorption unit product cost for .200 of $8400 Its markup percentage on absorption seems to overlook the fact that the XP-200 offers superior performance relative to the comparable keting managers have expressed concerns about the use of absorption cost-plus pricing because it Valmont's primary competitor More specifically, the XP-200 can be used for 20,000 hours before replacement. It only requires $1,000 preventive maintenance during its useful life and it consumes $120 of electricity per 1,000 hours used of use, requires $2,000 m Required: These figures compare favorably to the competing piece of equipment that sells for $15,000, needs to be replaced after 10,000 hours of preventive maintenance during its useful life, and consumes $140 of electricity per 1,000 hours used. uses absorption cost-plus pricing, what price will it establish for the XP-200? is -200 s economic value to the customer(EVC) over its 20,000-hour life? uses value-based pricing, what range of possible prices should it consider when setting a price for the XP-200 Complete this question bv entering vour answers in the tabs below vaimont uses aosorpuon cost-pius pricing, wnat price wilII I estaDlusn Tor une A-: What is XP-200's economic value to the customer (EVC) over its 20,000-hour life? If Valmont uses value-based pricing, what range of possible prices should it consider when Complete this question by entering your answers in the tabs below. Req 1 and 2 Req 3 1. If Valmont uses absorption cost-plus pricing, what price will it establish for the XP-200? 2. What is XP-200's economic value to the customer (EVC) over its 20,000-hour life? 1. Selling price per unit 2. EVC S 15,540 $ 19,940 Req 3 > He vaimont uses aosorption cost-pius pricing, wnat price will it estapisn Tor tne AP-ZUU hat is XP-200's economic value to the customer (EVC) over its 20,000-hour life? Valmont uses value-based pricing, what range of possible prices should it consider when setting a price for the Complete this question by entering your answers in the tabs below. Req 1 and 2 Req 3 If Valmont uses value-based pricing, what range of possible prices should it consider when setting a price for the XP-200? Range of possible prices s Value-based price KReq 1 and 2