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28 Sep 2019
Product Cost Concept of Product Costing
MyPhone, Inc., uses the product cost concept of applying thecost-plus approach to product pricing. The costs of producing andselling 4,740 units of cellular phones are as follows:
Variable costs: Fixed costs: Direct materials $72 per unit Factory overhead $202,000 Direct labor 39 Selling and admin. exp. 68,600 Factory overhead 26 Selling and admin.exp. 20 Total $157 per unit
MyPhone desires a profit equal to a 16% rate of return oninvested assets of $601,000.
a. Determine the amount of desired profit fromthe production and sale of 4,740 units of cellular phones.
$
b. Determine the cost amount per unit for theproduction of 4,740 units of cellular phones. If required, roundyour answer to nearest dollar.
$ per unit
c. Determine the product cost markup percentage(rounded to two decimal places) for cellular phones.
%
d. Determine the selling price of cellularphones. Round to the nearest dollar.
Cost $ per unit Markup $ per unit Selling price $ per unit
Product Cost Concept of Product Costing MyPhone, Inc., uses the product cost concept of applying thecost-plus approach to product pricing. The costs of producing andselling 4,740 units of cellular phones are as follows:
MyPhone desires a profit equal to a 16% rate of return oninvested assets of $601,000. a. Determine the amount of desired profit fromthe production and sale of 4,740 units of cellular phones. b. Determine the cost amount per unit for theproduction of 4,740 units of cellular phones. If required, roundyour answer to nearest dollar. c. Determine the product cost markup percentage(rounded to two decimal places) for cellular phones. d. Determine the selling price of cellularphones. Round to the nearest dollar.
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Deanna HettingerLv2
28 Sep 2019