Techcom is designing a new smartphone. Each unit of this new phone will require $232 of...
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Techcom is designing a new smartphone. Each unit of this new phone will require $232 of direct materials; $12 of direct labor; $25 of variable overhead; $20 of variable selling, general, and administrative costs; $34 of fixed overhead costs; and $12 of fixed selling, general, and administrative costs. 1. Compute the selling price per unit if the company uses the total cost method and plans a markup of 180% of total costs. 2. The company is a price-taker and the expected selling price for this type of phone is $820 per unit. Compute the target cost per unit if the company's target profit is 60% of expected selling price. 3. Compute the selling price per unit if the company uses the variable cost method and plans a markup of 200% of variable costs. Techcom is designing a new smartphone. Each unit of this new phone will require $232 of direct materials; $12 of direct labor; $25 of variable overhead; $20 of variable selling, general, and administrative costs; $34 of fixed overhead costs; and $12 of fixed selling, general, and administrative costs. 1. Compute the selling price per unit if the company uses the total cost method and plans a markup of 180% of total costs. 2. The company is a price-taker and the expected selling price for this type of phone is $820 per unit. Compute the target cost per unit if the company's target profit is 60% of expected selling price. 3. Compute the selling price per unit if the company uses the variable cost method and plans a markup of 200% of variable costs.
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