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World view is considering production of a lighted world globe that the company would price at a markup of 25 percent above full cost. Management estimates that the variable cost of the globe will be $60 per unit and fixed costs per year will be $240,000.
Required:

A) Assuming sales of 1,200 units, what is the full cost of globe, and what is the price with a 25 percent markup? Price is 325

B) Assume that the quantity demanded at the price calculated in part a is only 600 units. What are the full costs of the globe, and what is the price with a 25 percent markup?

Is the company likely to sell 600 units at the price calculated in part b?

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Financial Accounting, Accounting

Category:- Financial Accounting
Reference No.:- M9404229

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