Product Cost Concept of Product Costing

MyPhone, Inc., uses the product cost concept of applying the cost-plus approach to product pricing. The costs of producing and selling 5,030 units of cellular phones are as follows:

Variable costs:						Fixed costs:
	Direct materials		$87	per unit			Factory overhead	$201,800
	Direct labor		31				Selling and admin. exp.	68,500
	Factory overhead		25
	Selling and admin. exp.		21
		Total	$164	per unit

MyPhone desires a profit equal to a 16% rate of return on invested assets of $601,200.

a. Determine the amount of desired profit from the production and sale of 5,030 units of cellular phones. $

b. Determine the cost amount per unit for the production of 5,030 units of cellular phones. If required, round your answer to nearest dollar. $ per unit

c. Determine the product cost markup percentage (rounded to two decimal places) for cellular phones. %

d. Determine the selling price of cellular phones. Round to the nearest dollar.

Cost	$per unit
Markup	$per unit
Selling price	$per unit