Reference no: EM133128044

Question - The following data pertain to LawnMate Corporation's top-of-the-line lawn mower.

Variable manufacturing cost $275

Applied fixed manufacturing cost 55

Variable selling and administrative cost 66

Allocated fixed selling and administrative cost ?

To achieve a target price of $495 per lawn mower, the markup percentage is 12.5 percent on total unit cost.

Required -

1. What is the fixed selling and administrative cost allocated to each unit of LawnMate's top-of-the- line mower?

2. For each of the following cost bases, develop a cost-plus pricing formula that will result in a target price of $495 per mower: (a) variable manufacturing cost, (b) absorption manufacturing cost, and (c) total variable cost.