Gibbs Corporation produces industrial robots for high-precision manufacturing. The following information is given for Gibbs Corporation.

The company has a desired ROI of 20%. It has invested assets of $54,000,000. It anticipates production of 3,000 units per year.
Instructions
(a) Compute the cost per unit of the fixed manufacturing overhead and the fixed selling and administrative expenses.
(b) Compute the desired ROI per unit. (Round to the nearest dollar.)
(c) Compute the target selling price.

Transcribed Image Text:

Per Unit $380 $290 $ 72 Total Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and administrative expenses $1,500,000 $ 55 s 324,000