Product Cost Method of Product Costing

Smart Stream Inc. uses the product cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 10,000 cell phones are as follows:

Variable costs per unit:

Line Item Description	Amount
Direct materials	$150
Direct labor	25
Factory overhead	40
Selling and administrative expenses	25
Total variable cost per unit	$240

Fixed costs:

Line Item Description	Amount
Factory overhead	$350,000
Selling and administrative expenses	140,000

Smart Stream desires a profit equal to a 30% return on invested assets of $1,200,000.

a. Determine the amount of desired profit from the production and sale of 10,000 cell phones. fill in the blank 1 of 1$

b. Determine the product cost per unit for the production of 10,000 cell phones. fill in the blank 1 of 1$per unit

c. Determine the product cost markup percentage for cell phones. fill in the blank 1 of 1 %

d. Determine the selling price of cell phones.

Line Item Description	Amount
Total Cost	$fill in the blank 4 per unit
Markup	fill in the blank 5 per unit
Selling price	$fill in the blank 6 per unit