Problema company must incur annual fixed costs of 4000000, Ask an Expert

Accounting

Problem:

A company must incur annual fixed costs of $4,000,000 and variable costs of $400 per unit and estimates that it can sell 40,000 pumps annually and marks up cost by 30%.

Required:

Question: Using cost-plus pricing, what is the cost per unit and the price? What are disadvantages of cost-plus pricing?

Note: Please show the work not just the answer.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91165293

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