Question
Jonas Company reports the following for production of 5,000 units of its single product: Direct materials cost = $24.50/unit; Direct labor cost = $12.75/unit; Variable
Jonas Company reports the following for production of 5,000 units of its single product: Direct materials cost = $24.50/unit; Direct labor cost = $12.75/unit; Variable factory overhead cost = $9.85/unit; Fixed factory overhead cost = $73,000; Variable selling and administrative cost = $4.25/unit; Fixed selling and administrative cost = $19,000. Jonas Companys investors want a profit of 12% on invested assets of $400,000.
What will be Jonas Companys selling price per unit? __________________
If Jonas Company is in a competitive market and can sell its product for only $70.00 per unit, what will have to change?
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