- EXCEL only and label each question properly. Question 1 Fake Fur Company manufactures ecological friendly fabric. Its primary customers are retailers. The estimated cost to make a metre of fabric is: Direct materials $ 1.50 Direct labour Variable overhead Fixed overhead $ 0.70 $ 2.05 $3.50 Total $7.75 Variable selling costs per unit $ 2.00 $12,500 Fixed administration charges If Fake Fur Company prices its product using a markup of 150% of its variable production costs, what would the unit selling price be? Question 2 Jodi Prentice, controller for Go Carts Limited (GCL) has just finished a market analysis of prices for golf carts. GCL currently sells 8,000 of its current model of golf carts for $3,000 each. A new competitor will sell a comparable cart for $2,800. Prentice has determined that dropping GCL's price to $2,850 would help the firm keep its annual market of 8,000 golf carts. Prentice presents the following information: Direct materials Direct labour Machine setups Mechanical assembly Actual Amounts Budget Amounts $4,200,000 100,000 hrs 75,000 hrs 75,000 hrs 375,000 hrs $4,500,000 125,000 hrs 400,000 hrs Actual Cost (8,000 carts) $4,500,000 $1,750,000 $ 750,000 $5,000,000 Calculate the target cost if the current profit per golf cart is to be maintained.