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Question 4.3 Lemon Lime Led. forecast sales of 42,000 units and production of 40,000 units. Other budget information related to the company for the year
Question 4.3 Lemon Lime Led. forecast sales of 42,000 units and production of 40,000 units. Other budget information related to the company for the year Included: Direct manufacturing labour $171,900 Variable manufacturing overhead 83.500 Direct materials 52,300 Variable selling expenses 23,000 Fixed administrative expenses 190.000 Fixed manufacturing overhead 240,000 The standard costs remained the same as in the previous year. Lemon Lime Lid. is considering various cost bases. The company management require a 15% return on an investment of $2,500,000. The company wants this cost built into all cost base options. Required 1. Compute the cost-plus price per unit using direct costing. 2. Compute the cost-plus price per unit using absorption costing. 3. Compute the cost-plus price per unit using the full product cost
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