Exercise 23-12 Product pricing using variable costs LO P6 Rios Co. makes drones and uses the variable cost approach in setting product prices. Its costs for producing 40,000 units follow. The company targets a profit of $320,000 on this product. Variable costs per Unit Pixed costs in total) Direct materials $ 90 Overhead $690,000 Direct labor 60 Selling 325,000 Overhead 45 Administrative 305,000 Selling 35 1. Compute the variable cost per unit. 2. Compute the markup percentage on variable cost. (Round percentage answer to 2 decimal places.) 3. Compute the product's selling price using the variable cost method. (Round your intermediate percentage calculations and final answer to 2 decimal places.) 1 2 3 Variable cost per unit Markup percentage Selling price