Absorption costing approach to cost-plus pricing

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Lafave Corporation uses the absorption costing approach to cost-plus pricing described in the text to set prices for its products. Based on budgeted sales of 95,000 units next year, the unit product cost of a particular product is $46.70. The company's selling and administrative expenses for this product are budgeted to be $1,912,000 in total for the year. The company has invested $276,000 in this product and expects a return on investment of 12%.

The markup on absorption cost for this product would be closest to:

Reference no: EM13774132

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Absorption costing approach to cost-plus pricing : Lafave Corporation uses the absorption costing approach to cost-plus pricing described in the text to set prices for its products. Based on budgeted sales of 95,000 units next year, the unit product cost of a particular product is $46.70. The company..

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