Question

Mussatto Corporation produces snowboards. The following per unit cost information is available: direct materials $15, direct labor $9, variable manufacturing overhead $10, fixed manufacturing overhead $12, variable selling and administrative expenses $5, and fixed selling and administrative expenses $8. Using a 40% markup percentage on total per unit cost, compute the target selling price. (Round answer to 2 decimal places, e.g. 10.50.) Target selling price $enter the target selling price in dollars rounded to 2 decimal places.

Answer 1

Answer:

Selling price= $54.6

Explanation:

Giving the following information:

The following per unit cost information is available: direct materials $15, direct labor $9, variable manufacturing overhead $10, fixed manufacturing overhead $12, variable selling and administrative expenses $5, and fixed selling and administrative expenses $8. Using a 40% markup percentage on total per-unit cost, compute the target selling price.

We will use variable costing to calculate the unitary cost:

Total unitary cost= direct material + direct labor + variable overhead + variable selling and administrative

Total unitary cost= 15 + 9 + 10 + 5= $39

Selling price= 39*1.40= $54.6