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Thornton Company sells a souvenir item at various resorts across the country. Its management uses the product's estimated quarterly cost to determine the selling price
Thornton Company sells a souvenir item at various resorts across the country. Its management uses the product's estimated quarterly cost to determine the selling price of its product. The company expects a large variance in demand for the product between quarters tue to its seasonal nature. The company does not expect overhead costs, which are predominately fixed, to vary significantly as to broduction volume or with amounts for previous years. Prices are established by using a cost-plus pricing strategy. The company finds ariations in short-term unit cost confusing to use. Unit cost variations complicate pricing decisions and many other decisions for which cost is a consideration. Required a. Based on estimated total production cost, determine the expected quarterly cost per unit for Thornton's product. -1. Calculate the predetermined overhead rate. b-2. Calculate the unit cost per quarter based on the predetermined overhead rate. Complete this question by entering your answers in the tabs below. Calculate the unit cost per quarter based on the predetermined overhead rate. (Round your intermediate calculations and fina answers to 2 decimal places.)
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