The production of a new product required Zion Manufacturing Co. to lease additional plant facilities. Based on studies, the following data have been made available: Estimated annual sales€”24,000 units

Selling expenses are expected to be 5% of sales, and net income is to amount to $2.00 per unit.
Required:
1. Calculate the selling price per unit. (Hint: Let €œX€ equal the selling price and express selling expense as a percentage of €œX.€)
2. Prepare an absorption costing income statement for the year ended December 31, 2016.
3. Calculate the break-even point expressed in dollars and in units, assuming that administrative expense and factory over- head are all fixed but other costs are fully variable.

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Amount Per Unit Estimated costs: $96,000 14,400 24,000 28,800 $163,200 $4.00 60 1.00 1.20 $6.80 Materials . . Total.