ovell Computer Parts Inc. is in the process of setting a selling price on a new component it has just designed and developed. The following cost estimates for this new component have been provided by the accounting department for a budgeted volume of 45,000 units.

		Per Unit				Total
Direct materials			$46
Direct labor			$26
Variable manufacturing overhead			$17
Fixed manufacturing overhead						$495,000
Variable selling and administrative expenses			$15
Fixed selling and administrative expenses						$360,000

Lovell Computer Parts management requests that the total cost per unit be used in cost-plus pricing its products. On this particular product, management also directs that the target price be set to provide a 18% return on investment (ROI) on invested assets of $1,000,000.

Part 1

Compute the markup percentage and target selling price that will allow Lovell Computer Parts to earn its desired ROI of 18% on this new component. (Round markup percentage to 2 decimal places, e.g. 10.50%.)

Assuming that the volume is 36,000 units, compute the markup percentage and target selling price that will allow Lovell Computer Parts to earn its desired ROI of 18% on this new component