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One of Atten'tive Company's products is luxury Throw Covers. They reached out to their research and development team for a new line for the Christmas
One of Atten'tive Company's products is luxury Throw Covers. They reached out to their research and development team for a new line for the Christmas season in 2022. The Finance Manager is in the process of setting a target price for the luxury Throw Covers. The marketing department did a survey and has projected high sales as soon as they launch. The cost data relating to the luxury Throw Covers at a budgeted volume of 8,000 units is as follows: Unit Cost Total Cost Direct Materials $75 Direct Labour $225 Variable Manufacturing overhead cost $30 Variable selling and Administrative expenses $15 Fixed manufacturing overhead cost $700,000 Fixed selling and administrative expenses $300,000 Required: a. Compute the total cost per Throw Cover (3 Marks) b. Compute the desired ROI per Throw Cover (2 Marks) c. Compute the mark up percentage using total cost per Throw Cover (2 Marks) d. Compute the target selling price of a Throw Cover
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