Product Cost Method of Product Costing

MyPhone, Inc. uses the product cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 5,430 cell phones are as follows:

Variable costs per unit:						Fixed costs:
	Direct materials		$73				Factory overhead	$198,400
	Direct labor		39				Selling and administrative expenses	70,000
	Factory overhead		26
	Selling and administrative expenses		20
		Total variable cost per unit	$158

MyPhone desires a profit equal to a 13% rate of return on invested assets of $598,300.

a. Determine the amount of desired profit from the production and sale of 5,430 cell phones. $77,779

b. Determine the product cost per unit for the production of 5,430 of cell phones. Round your answer to the nearest whole dollar. $175 per unit

c. Determine the product cost markup percentage for cell phones. Round your answer to two decimal places. %________

d. Determine the selling price of cell phones. Round your answers to the nearest whole dollar.

Total Cost	$________per unit
Markup	_________per unit
Selling price	$________per unit