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.