Cell Plus Inc. uses the net cost concept of applying the cost-plus approach to product pricing. The cost of selling and producing 5,000 units of cellular phones are as given:

                          Variable Costs:                                                Fixed Costs:

Direct Materials       $125 per unit                                   Factory Overhead      $215,000

Direct Labor  45                                                             Selling and admin exp.  75,000

Factory Overhead  40                                                   Selling & admin exp  30

Total      $240 per unit

A. Cell Plus uses the product cost idea of applying the cost-plus method to product pricing.

• Evaluate the cost amount per unit and total manufacturing costs for the production and sale of 5,000 units of cellular phones.
• Evaluate the product cost markup percentage rounded to two decimal places for cellular phones.
• Evaluate the selling price of cellular phones.

B. Cell Plus uses the variable cost idea of applying the cost-plus method to product pricing.

• Evaluate the variable costs and the cost amount per unit for the production and sale of 5,000 units of cellular phones.
• Evaluate the variable cost markup percentage rounded to two decimal places for cellular phones.
• Evaluate the selling price of cellular phones.