Q5. (30 minutes, 20 marks) Monroe Corporation manufactures Part No. 67, which is used in the production of mountain bikes. Per-unit information about Part No. 67 follows. Prevailing market price Direct materials Direct labor Manufacturing overhead Selling and administrative expenses $33 14 6 7 Monroe has traditionally used a 20% markup on total cost to arrive at a reasonable selling price. The company, though, has noticed a sizable drop in sales volume during the last few quarters, which it attributes to new entrants in the marketplace. REQUIRED: A. Compute the current selling price of Part No. 67. = B. If management desired to meet the prevailing market price and maintain the current rate of profit on sales, what must happen to the company's total manufacturing costs? By how much