Q.2 Babloo Toys, manufactures and sells 15,000 units of Teddy Bear toy (TB), in 2015. The full cost per unit is USD 200. Babloo Toys earns a 20% return on an investment of USD 1800,000 in 2015. Required: (1) Calculate the selling price and the markup percentage on the full cost per unit of TB toy in 2015. (2) If the selling price in requirement 1 represents a markup percentage of 40% on variable cost per unit, calculate the variable cost per unit of TB toy in 2015. (3) Calculate Babloo Toys's operating income if it had increased the selling price to USD 230. At this price Babloo Toys would have sold 13,500 units of TB toy. Assume no change in total fixed costs. Should Babloo Toys increase the selling price of TB toy to USD 230? (4) In response to competitive pressures, Babloo Toys must reduce the price of TB toy to USD 210 in 2016, in order to achieve sales of 15,000 units. Babloo Toys plans to reduce its investment to USD 1,650,000. If Babloo Toys wants to maintain a 20% return on investment, what is the target cost per unit in 2016?