Evaluate total variable costs for the production and sale

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Reference no: EM136167

Moon Company uses the variable cost idea of applying the cost-plus approach to product pricing. The costs and expenses of selling and producing 75,000 units of Product T are as given:

VARIABLE COSTS:

DM: $7.00

DL: $3.50

FOH: $1.50

Selling and Admin exp: $3.00

Total: $15.00

Fixed Costs:

FOH: $45,000

Selling & Admin exp: $20,000

Moon desires a profit equal to 18 percent rate of return on invested assets of $1,440,000.

a. Evaluate the amount of desired profit from the production and sale of Product T.

b. Evaluate the total variable costs for the production and sale of 75,000 units of Product T.

c. Evaluate the markup percentage for Product T.

d. Evaluate the unit selling price of Product T.

Reference no: EM136167

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