Question 24 (3 points) A distributor who buys the product for resale has identified three activities and cost pools during the period as below: Activity Cost driver Quantity of cost driver Cost per unit of cost driver Number of orders 10 $5 per order Loads moved 20 Paying for orders Receiving & storage Shipping to customers $2 per load Number of shipments 15 $6 per shipment The distributor buys 200 units at the average cost of $3 per unit. Calculate the prospective selling price if the mark-up is based on the full cost by 10%. a) $3.17 b) $4.29 c) $5.67 d) $5.09 Question 25 (3 points) The company plans to develop a new product, which will take 6 months to design and test, expecting to sell 50 units during the first 6 months of sales; 100 units per year over the following 2 years. Based on the following costs, what will be operating income with the price of $10 over the product's life cycle? Period Cost Months 0-6 Design Months 7 - 36 Production Total FC for the period VC per unit $120 $150 $4 $80 $50 $2 Marketing Distribution a) $600 b) $400 $500 d) $550