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Sutherland manufactures and sells 110,000 laser printers each month. A principal component part in each printer is its paper feed drive. Sutherland's plant currently has the monthly capacity to produce 150,000 drives. The unit costs of manufacturing these drives (up to 150,000 per month) are as follows:
Variable costs per unit:
Direct materials
$
45
Direct labor
25
Variable manufacturing overhead
5
Fixed costs per month:
Fixed manufacturing overhead
1,430,000
b. Compute the incremental unit cost of producing an additional paper feed drive. Show your work on how you came up with answer. Incremental unit cost $
c. Compute the per-unit sales price that Sutherland should charge Desk-Mate to earn $500,000 in monthly pretax profit on the sale of drives to Desk-Mate. Show your work on how you came up with answer. Unit sales price $
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