Product Cost Concept of Product Pricing

StarMed Products Inc. uses the product cost concept of applying the cost-plus approach to product pricing. The costs of producing and selling 100,000 units of medical tablets are as follows:

Variable costs:

Direct materials: $270 per unit

Direct labor: 60

Factory overhead: 90

Selling and admin exp: 45

Total: $465 per unit

Fixed costs:

Factor overhead: $2,400,000

Selling and admin exp: 1,100,000

StarMed Products desires a profit equal to a 20% rate of return on invested assets of $15,000,000.

a. Determine the total manufacturing costs for the production and sale of 100,000 units.

Variable: $__

Fixed factory overhead: 2,400,000

Total: $__

Determine the cost amount per unit for the production and sale of 100,000 units. $__ per unit

b. Determine the product cost markup percentage per unit. Round your percentage answer to two decimal places. __%

c. Determine the selling price per unit. Use the rounded product cost markup percentage in your calculations, and round the amount of the markup to the nearest whole dollar. $__ per unit