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QuickBooks LLC offers bookkeeping services to small businesses. Each job takes approximately 10 hours. The company anticipates 500 jobs annually. They have invested $500,000 in

QuickBooks LLC offers bookkeeping services to small businesses. Each job takes approximately 10 hours. The company anticipates 500 jobs annually. They have invested $500,000 in their facilities and expect an ROI of 20%. The budgeted costs for the coming year are shown below:

Cost ItemPer Job ($)Total ($)
Direct Materials (Software)157,500
Direct Labor (Bookkeepers)5025,000
Variable Overhead105,000
Fixed Overhead-80,000
Variable Selling & Admin Expenses52,500
Fixed Selling & Admin Expenses-30,000

Required:

  1. Calculate the total cost per job.
  2. Determine the desired ROI per job.
  3. Compute the target price per job.

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