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Question: MyPhone Inc. uses the total cost concept of applying the cost-plus approach to product pricing. The costs of producing and selling 8,000 units of cellular phones are as follows: Variable costs: Fixed costs:

Direct materials $146 per unit

Factory overhead $400,000

Direct labor 53

Selling and admin. exp. 136,000

Factory overhead 45

Selling and admin. exp. 36

Total $280 per unit

MyPhone desires a profit equal to a 20%

rate of return on invested assets of $1,318,600.

a. Determine the total cost markup percentage (rounded to one decimal place).

b. Determine the selling price per unit. Round to the nearest cent.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M92642350

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