Problem # 1 (3 points)

Great Outlook Company manufactures and sells one product. The following information pertains to the companys first year of its operation:

Variable costs per unit:

Manufacturing:

Direct materials . $15

Direct labor. $10

Variable manufacturing overhead $5

Variable selling and administrative $2

Fixed costs per year:

Fixed manufacturing overhead $240,000

Fixed selling and administrative expenses $60,000

During its first year of operation, Great Outlook Company produced 60,000 units and sold 40,000 units. The selling price of the companys product is $80 per unit?