National Corporation needs to set a target price for its newly designed product M14M16. The following data relate to this new product.

		Per Unit			Total
Direct materials		$20
Direct labor		$39
Variable manufacturing overhead		$15
Fixed manufacturing overhead					$1,264,000
Variable selling and administrative expenses		$ 6
Fixed selling and administrative expenses					$ 1,106,000

These costs are based on a budgeted volume of 79,000 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%.

1) Compute the desired ROI per unit for M14M16.

2) Compute the target selling price for M14M16.