What should be the price per unit

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Question - Fine Arts Inc. produces a special kind of light weight, recreational vehicle that has a unique design. It allows the company to follow a cost-plus pricing strategy. It has $9,000,000 of assets and shareholders expect a 18% return on assets. Additional data are as follows:

Sales volume 4,000 units per year

Variable costs $2,000 per unit

Fixed cost $3,500,000 per year

Using the cost-plus pricing approach, what should be the price per unit?

Reference no: EM133183196

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