product pricing hsing the cost-plus approach method; differential analysis for accepting additional business

Product Pricing using the Cost-Plus Approach Methods; Differential Analysis for Accepting Additional Business Digital Displays Inc, recently began production of a new product, flat panel displays, which required the investment of $6,000,000 in assets. The costs of producing and selling 20,000 units of flat panel displays are estimated as follows: Digital Displays inc is currently considering establishing a selling price for flot panel displays. The president of Digital Displays has decided to use the cost-plus approach to product pricing and has indicated that the displays must eahi a 15% return on invested assets. Note: Round all markup percentages to two decimal places, if required. Round all costs per unit and selling prices per unit to the nearest whole d 1. Determine the amount of desired profit from the production and sale of flat panel displays. x 2. Assuming that the product cost, method is used, determine the following: 3. (Appendix) Assuming that the total cost method is used, determine the following: 4. (Appendix) Assuming that the variable cost method is used, determine the following: Assume that as of October 31,16,000 units of flat panel displays have been produced and sold during the current year. Analysis 500 additional units are expected to be sold during the remainder of the year at the normal product price determined under the product cost method. On November 5 , gital Displays Inc. received an offer from Andes Visual Inc. for 1,000 units of fat panel displays at $225 each. Andes Visual Inc. will market the units in Peru under its wn brand name, and no variable selling and administrative expenses associated with the sale will be incurred by Digital Displays Inc. The additional business is not xpected to affect the domestic sales of fat panel displays, and the additional units could be produced using existing factory, seilling, and administrative capacity. Prepare a differential analysis of the proposed sale to Andes Visual Inc. If an amount is zero, enter "0