Wilderness Products, Inc., has designed a self-inflating sleeping pad for use by backpackers and campers. The following information is available about the new product: a. An investment of $1,650,000 will be necessary to carry inventories and accounts receivable and to purchase some new equipment needed in the manufacturing process. The company's required rate of return is 16% on all investments b. A standard cost card has been prepared for the sleeping pad, as shown below: Standard Quantity or Hours Direct materials Direct labor Manufacturing overhead (20% variable) Total standard cost per pad Standard Price or Rate $ 3.30 per yard $9.00 per hour $13.00 per hour Standard Cost $ 29.70 9 yards 5.4 hours 5.4 hours 48.60 70.20 $148.50 c. The only variable selling and administrative expense will be a sales commission of $9 per pad. The fixed selling and administrative expenses will be $4,812,000 per year. d. Because the company manufactures many products, no more than 162,000 direct labor-hours per year can be devoted to production of the new sleeping pads. e. Manufacturing overhead costs are allocated to products on the basis of direct labor-hours. Required 1. Assume that the company uses the absorption approach to cost-plus pricing a. Compute the markup percentage that the company needs on the pads to achieve a 16% return on investment (ROI) if it sells all of the pads it can produce b. What selling price per sleeping pad will the company establish if it uses a markup percentage on absorption cost? (Round intermediate calculations and final answer to 2 decimal places.) C. Assume that the company is able to sell all of the pads that it can produce. Compute the company's ROl based on the first year of activity. 2. After marketing the sleeping pads for several years, the company is experiencing a falloff in demand due to an economic recession. A large retail outlet will make a bulk purchase of pads if its label is sewn in and if an acceptable price can be worked out. What is the minimum acceptable price for this special order? (Round your answer to 2 decimal places.) Required: 1. Assume that the company uses the absorption approach to cost-plus pricing a. Compute the markup percentage that the company needs on the pads to achieve a 16% return on investment (ROI) if it sells all of the pads it can produce b. What selling price per sleeping pad will the company establish if it uses a markup percentage on absorption cost? (Round intermediate calculations and final answer to 2 decimal places.) c. Assume that the company is able to sell all of the pads that it can produce. Compute the company's ROl based on the first year of activity. 2. After marketing the sleeping pads for several years, the company is experiencing a falloff in demand due to an economic recession. A large retail outlet will make a bulk purchase of pads if its label is sewn in and if an acceptable price can be worked out. What is the minimum acceptable price for this special order? (Round your answer to 2 decimal places.) 1a. Markup percentage 1b. Selling price 1c. Return on investment 2. Minimum acceptable price wilderness Products, Inc, has designed a sef-inflting sleeping pad for use by backpackers and campers. The following information is available about the new product a. An investment of $1.650,000 will be necessary to carry inventories and accounts receivable and to purchase some new equipment needed in the manufacturing process. The company's required rate of return is 16% on all investments. b. A standard cost card has been prepared for the sleeping pad, as shown below: Standard Quantity or HourS Standard Price oz Rate Standard Direct saterials Direct labor Manufacturing overhead (208 variable) Total standard cost pez pad 9 yards 5.4 hours 3-30 per yard $ 9.00 per 29.70 48.60 .4 hours $13.00 per hour 70.20 $148.5O C The only variable selling and administ trative expense will be a sales commission of $9 per pad. The fixed seling and administrative expenses will be $4,812,000 per year the company manufactures many products, no more than 162.000 direct labor-hours per yeer can be devoted to production of the new sleeping pads e Manufacturing overhead costs are allocated to products on the basis of direct labor-hours. Required: 1. Assume that the company uses the absorption approach to cost-plus pricing. Compute the markup percentage that the company needs on the pads to achieve 16% return on investment RO the pads it can produce b. What selling price per sleeping pad will the company establish if it uses a markup percentage on absorption cost? intermediate calculations and final answer to 2 decimal places.) c. Assume that the company Is able to sell all of the pads that it can produce. Compute the activity. 2. After A large retail outiet will make a bulk purchase of peds if its label is sewn in and if an acceptable price minimum acceptable price for this special order? (Round your answer to 2 decimal places f it sells all of (Round company's RO based on the first year of marketing the sleeping pads for several years, the company is experiencing a falloff in demand due to an economic recession. IDSeling price 1c 2. Mnjmum acceptable price on Iinvestiment Prev 5 ofiNext> Currington Company wants to use absorption cost-plus pricing to set the selling price on a newly remodeled product. The company plans to invest $164,000 in operating assets to produce and sell 12,000 units. Its required retum on investment (ROO in its operating assets is 16%. The accounting department has provided cost estimates for the new product as follows: Per UnitTotal Direct naterials Direct labor variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and adninistrative expenses $4.70 $3.70 $1.70 74,400 $ 12,040 $1.70 Required: 1. What is the unit product cost for the remodeled product? (Round intermediate calculations and final answer to 2 decimal places.) 2. What is the markup percentage on absorption cost for the remodeled product? (Round intermediate calculations to 2 decimal places.) 3. What selling price would the company establish for its remolded product using a markup percentage on absorption cost? (Round intermediate calculations and final answer to 2 decimal places.) 4. Suppose the company actually produced and sold only 10,000 units (instead of its planned sales volume of 12,000 units) at the selling price that you derived in requirement 3. What ROI did the company actually earn at this lower sales volume? (Round intermediate calculations to 2 decimal places. Round your percentage answer to 1 decimal place.) 5. Assume that the company wants to raise the price of its newly remodeled product with the intention of achieving the product's desired ROl at the lower sales volume of 10,000 units. Using absorption cost-plus pricing, what would be the revised selling price at this lower sales volume? (Round your intermediate percentages to 1 decimal place. Round all other intermediate calculations to 2 decimal places.) 1. Unit product cost 2 Markup percentage on absorption cost 3. Seling price per unit 4. Return on investment 5. Revised selling price per unit Prey 60f 6111 Next > Wilderness Products, Inc., has designed a self-inflating sleeping pad for use by backpackers and campers. The following information is available about the new product: a. An investment of $1,650,000 will be necessary to carry inventories and accounts receivable and to purchase some new equipment needed in the manufacturing process. The company's required rate of return is 16% on all investments b. A standard cost card has been prepared for the sleeping pad, as shown below: Standard Quantity or Hours Direct materials Direct labor Manufacturing overhead (20% variable) Total standard cost per pad Standard Price or Rate $ 3.30 per yard $9.00 per hour $13.00 per hour Standard Cost $ 29.70 9 yards 5.4 hours 5.4 hours 48.60 70.20 $148.50 c. The only variable selling and administrative expense will be a sales commission of $9 per pad. The fixed selling and administrative expenses will be $4,812,000 per year. d. Because the company manufactures many products, no more than 162,000 direct labor-hours per year can be devoted to production of the new sleeping pads. e. Manufacturing overhead costs are allocated to products on the basis of direct labor-hours. Required 1. Assume that the company uses the absorption approach to cost-plus pricing a. Compute the markup percentage that the company needs on the pads to achieve a 16% return on investment (ROI) if it sells all of the pads it can produce b. What selling price per sleeping pad will the company establish if it uses a markup percentage on absorption cost? (Round intermediate calculations and final answer to 2 decimal places.) C. Assume that the company is able to sell all of the pads that it can produce. Compute the company's ROl based on the first year of activity. 2. After marketing the sleeping pads for several years, the company is experiencing a falloff in demand due to an economic recession. A large retail outlet will make a bulk purchase of pads if its label is sewn in and if an acceptable price can be worked out. What is the minimum acceptable price for this special order? (Round your answer to 2 decimal places.) Required: 1. Assume that the company uses the absorption approach to cost-plus pricing a. Compute the markup percentage that the company needs on the pads to achieve a 16% return on investment (ROI) if it sells all of the pads it can produce b. What selling price per sleeping pad will the company establish if it uses a markup percentage on absorption cost? (Round intermediate calculations and final answer to 2 decimal places.) c. Assume that the company is able to sell all of the pads that it can produce. Compute the company's ROl based on the first year of activity. 2. After marketing the sleeping pads for several years, the company is experiencing a falloff in demand due to an economic recession. A large retail outlet will make a bulk purchase of pads if its label is sewn in and if an acceptable price can be worked out. What is the minimum acceptable price for this special order? (Round your answer to 2 decimal places.) 1a. Markup percentage 1b. Selling price 1c. Return on investment 2. Minimum acceptable price wilderness Products, Inc, has designed a sef-inflting sleeping pad for use by backpackers and campers. The following information is available about the new product a. An investment of $1.650,000 will be necessary to carry inventories and accounts receivable and to purchase some new equipment needed in the manufacturing process. The company's required rate of return is 16% on all investments. b. A standard cost card has been prepared for the sleeping pad, as shown below: Standard Quantity or HourS Standard Price oz Rate Standard Direct saterials Direct labor Manufacturing overhead (208 variable) Total standard cost pez pad 9 yards 5.4 hours 3-30 per yard $ 9.00 per 29.70 48.60 .4 hours $13.00 per hour 70.20 $148.5O C The only variable selling and administ trative expense will be a sales commission of $9 per pad. The fixed seling and administrative expenses will be $4,812,000 per year the company manufactures many products, no more than 162.000 direct labor-hours per yeer can be devoted to production of the new sleeping pads e Manufacturing overhead costs are allocated to products on the basis of direct labor-hours. Required: 1. Assume that the company uses the absorption approach to cost-plus pricing. Compute the markup percentage that the company needs on the pads to achieve 16% return on investment RO the pads it can produce b. What selling price per sleeping pad will the company establish if it uses a markup percentage on absorption cost? intermediate calculations and final answer to 2 decimal places.) c. Assume that the company Is able to sell all of the pads that it can produce. Compute the activity. 2. After A large retail outiet will make a bulk purchase of peds if its label is sewn in and if an acceptable price minimum acceptable price for this special order? (Round your answer to 2 decimal places f it sells all of (Round company's RO based on the first year of marketing the sleeping pads for several years, the company is experiencing a falloff in demand due to an economic recession. IDSeling price 1c 2. Mnjmum acceptable price on Iinvestiment Prev 5 ofiNext> Currington Company wants to use absorption cost-plus pricing to set the selling price on a newly remodeled product. The company plans to invest $164,000 in operating assets to produce and sell 12,000 units. Its required retum on investment (ROO in its operating assets is 16%. The accounting department has provided cost estimates for the new product as follows: Per UnitTotal Direct naterials Direct labor variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and adninistrative expenses $4.70 $3.70 $1.70 74,400 $ 12,040 $1.70 Required: 1. What is the unit product cost for the remodeled product? (Round intermediate calculations and final answer to 2 decimal places.) 2. What is the markup percentage on absorption cost for the remodeled product? (Round intermediate calculations to 2 decimal places.) 3. What selling price would the company establish for its remolded product using a markup percentage on absorption cost? (Round intermediate calculations and final answer to 2 decimal places.) 4. Suppose the company actually produced and sold only 10,000 units (instead of its planned sales volume of 12,000 units) at the selling price that you derived in requirement 3. What ROI did the company actually earn at this lower sales volume? (Round intermediate calculations to 2 decimal places. Round your percentage answer to 1 decimal place.) 5. Assume that the company wants to raise the price of its newly remodeled product with the intention of achieving the product's desired ROl at the lower sales volume of 10,000 units. Using absorption cost-plus pricing, what would be the revised selling price at this lower sales volume? (Round your intermediate percentages to 1 decimal place. Round all other intermediate calculations to 2 decimal places.) 1. Unit product cost 2 Markup percentage on absorption cost 3. Seling price per unit 4. Return on investment 5. Revised selling price per unit Prey 60f 6111 Next >