Question
Monroe Inc. has predicted the following costs for this year for 100,000 units: Manufacturing Selling and Administrative Variable $1,600,000 $ 400,000 Fixed 2,400,000 1,200,000 Total
Monroe Inc. has predicted the following costs for this year for 100,000 units:
Manufacturing | Selling and Administrative | |
Variable | $1,600,000 | $ 400,000 |
Fixed | 2,400,000 | 1,200,000 |
Total | $4,000,000 | $1,600,000 |
Required:
a. What is the markup on variable costs needed to achieve a target profit of $250,000?
b. What is the initial unit selling price needed to obtain a target profit of $250,000 using the variable cost markup method?
c. What is the manufacturing cost markup needed to obtain a target profit of $250,000?
d. What is the initial unit selling price needed to obtain a target profit of $250,000 using the manufacturing cost markup method?
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