Required information Problem 15-39 Cost-Plus Pricing; Bidding (LO 15-3,15-10) (The following information applies to the questions displayed below.) North American Pharmaceuticals, Inc., specializes in packaging bulk drugs in standard dosages for idcal hospitals. The company has been in business for seven years and has been profitable since its second year of operation. Don Greenway, Assistant Controller, installed a standard costing system after joining the company three years ago Wyant Memorial Hospital has asked North American Pharmaceuticals to bid on the packaging of three million doses o medication at total cost plus a return on total cost of no more than 15 percent. Wyant defines total cost as including all variable costs of performing the service, a reasonable amount of fixed overhead, and reasonable administrative costs. The hospital will supply all packaging materials and ingredients. Wyant has indicated that any bid over $0.04 per dose will be rejected. Greenway has accumulated the following information prior to the preparation of the bid. Direct labor Variable overhead Fixed overhead Incremental administrative costs Production rate $36.00 per direct-labor hour (DLH) $32.00 per DLH $40.00 per DLH $4,000 for the order 4,000 doses per DLH Problem 15-39 Part 2 2. Calculate the bid price per dose using total cost and the maximum allowable return specified by Wyant Memorial Hospital (Round your answer to 3 decimal places.) Answer is complete but not entirely correct. Bid price per dose S 0032 Under which of the following condition(s) are prices said to be elastic? A. B. C. D. E. Price Change Increase Increase Decrease Decrease Either sizable increase or decrease Change in Sales Volume Sizable increase Sizable decrease Sizable increase Sizable decrease Either sizable increase or decrease Multiple Choice Choice A Choice O Choice Choice Choice The following data pertain to Ronaldo Enterprises: Variable manufacturing cost Variable selling and administrative cost Applied fixed manufacturing cost Allocated fixed selling and administrative cost $85 35 55 30 What price will the company charge if the firm uses cost-plus pricing based on absorption manufacturing cost and a markup percentage Multiple Choice $115.50 $178.50 $267.27 $336.00 None of the answers is correct