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See 17-4 and solve VELER Problem 17-4. charged to clients was only 100 hours? Assume that all costs are fixed. Valade Company produces two products,
See 17-4 and solve VELER Problem 17-4. charged to clients was only 100 hours? Assume that all costs are fixed. Valade Company produces two products, J and K. Estimated costs are presented below for a year in which 10,000 units of each product are expected to be sold: Total Product ) Product K Direct production cost $700,000 $400,000 $300,000 Overhead cost 280,000 160,000 120,000 Selling and administrative cost 140,000 80,000 60,000 anagement Accounting An annual profit of $280,000 for the whole company is considered satisfactory. The company uses the same profit margin (as a percentage of costs) to arrive at the price for both products. Required: a. Calculate normal selling prices for products J and K. b. Using the prices calculated above, how much profit would result if the sales were 5,000 units of J and 15,000 units of K instead of 10,000 units of each? c. Comment on the effect of changes in the product mix on total profit when the same profit margin percentage is used
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