(See attached image)

1. What is the target selling price under absorption price costing?

(A)$127.50

(B)$135.00

(C)$140.25

(D)$145.95

2. What is the target selling price under variable cost pricing?

(A)$127.50

(B)$135.00

(C)$140.25

(D)$145.95

*P22-7A Stent Corporation needs to set a target price for its newly designed product EverReady. The following data relate to this new product. Total Per Unit Direct materials Direct labor $20 $40 $10 Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and administrative expenses $1,600,000 $ 5 $1,120,000 The costs shown above are based on a budgeted volume of 80,000 units produced and sold each year. Stent uses cost-plus pricing methods to set its target selling price. Because some managers prefer absorption-cost pricing and others prefer variable-cost pricing, the account- ing department provides information under both approaches using a markup of 50% on absorption cost and a markup of 80% on variable cost