M N A B C H K 2 Q.2 3 Use cost-plus pricing to determine various amounts 4 5 National Corporation needs to set a target price for its newly designed product M14-M16. The following data relate to this new product 6 Per Unit Total 7 Direct materials $25 8 Direct labor $40 9 Variable manufacturing overhead $10 10 Fixed manufacturing overhead $1,440,000 11 Variable selling and administrative expenses $5 12 Fixed selling and administrative expenses $960,000 13 14 15 16 17 These costs are based on a budgeted volume of 80,000 units produced and sold each year. National uses cost-plus pricing methods to set its target selling price. The markup percentage on total unit cost is 40% Instructions (a) Compute the total variable cost per unit, total fixed cost per unit, and total cost per unit for M14-M16 18 19 (b) Compute the desired ROI per unit for M14-M16 20 21 22 23 24 (c) Compute the target selling price for M14-M16. (d) Compute variable cost per unit, fixed cost per unit, and total cost per unit assuming that 60,000 M14-M16s are sold during the year. NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?".