Question
Voice Com, Inc., uses the product cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 4,990 units of
Voice Com, Inc., uses the product cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 4,990 units of cell phones are as follows: Variable costs: Fixed costs: Direct materials $68 per unit Factory overhead $198,900 Direct labor 34 Selling and admin. exp. 68,900 Factory overhead 22 Selling and admin. exp. 21 Total variable cost per unit $145 per unit Voice Com desires a profit equal to a 15% rate of return on invested assets of $600,600.
a. Determine the amount of desired profit from the production and sale of 4,990 units of cell phones. $
b. Determine the product cost per unit for the production of 4,990 of cell phones. If required, round your answer to nearest dollar. $ per unit
c. Determine the product cost markup percentage (rounded to two decimal places) for cell phones. % d. Determine the selling price of cell phones. Round to the nearest dollar. Total Cost $ per unit Markup per unit Selling price $ per unit
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