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Problem - Leno Company makes swimsuits and sells these suits directly to retailers. Although Leno has a variety of suits, it does not make the All-Body suit used by highly skilled swimmers. The market research department believes that a strong market exists for this type of suit. The department indicates that the All-Body suit would sell for approximately $107. Given its experience, Leno believes the All-Body suit would have the following manufacturing costs.
Direct materials
$23
Direct labor
34
Manufacturing overhead
46
Total costs
$103
Required - What is the highest acceptable manufacturing cost Leno would be willing to incur to produce the All-Body swimsuit, if it desired a profit of $22 per unit?
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