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The last two questions please! thank you Lovell Computer Parts Inc. is in the process of setting a selling price on a new component it
The last two questions please! thank you
Lovell Computer Parts Inc. is in the process of setting a selling price on a new component it has just designed and developed. The following cost estimates for this new component have been provided by the accounting department for a budgeted volume of 50,000 units. Total Per Unit $52 $21 $23 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and administrative expenses $750,000 $14 $350,000 Lovell Computer Parts management requests that the total cost per unit be used in cost-plus pricing its products. On this particular product, management also directs that the target price be set to provide a 30% return on investment (ROI) on invested assets of $1,000,000 (a) Your answer is correct. Compute the markup percentage and target selling price that will allow Lovell Computer Parts to earn its desired ROI of 30% on this new component. (Round markup percentage to 2 decimal places, eg. 10.50%) 4.55 % Markup percentage Target selling price 138 eTextbook and Media Attempts: 1 of 3 used (b) Assuming that the volume is 40,000 units, compute the markup percentage and target selling price that will allow Lovell Computer Parts to earn its desired ROI of 30% on this new component. (Round answers to 2 decimal places, eg. 10.50% or 10.50.) % Markup percentage Target selling price $Step by Step Solution
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