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Quamma Corporation makes a product that has the following costs: Per Unit $17.60 $15.20 2.50 Per Year Direct materials Direct labor Variable manufacturing overhead Fixed
Quamma Corporation makes a product that has the following costs: Per Unit $17.60 $15.20 2.50 Per Year Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and administrative expenses $908,000 $ 4.20 $565,000 The company uses the absorption costing approach to cost-plus pricing as described in the text. The pricing calculations are based on budgeted production and sales of 40,000 units per year. The company has invested $.650,000 in this product and expects a return on investment of 10%. Required: a. Compute the markup on absorption cost. (Round your intermediate and final answer to 2 decimal places.) b. Compute the selling price of the product using the absorption costing approach. (Round your intermediate and final answer to 2 decimal places.) a. Markup percentage on absorption cost b. Selling price
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