Rios Co. makes drones and uses the variable cost approach in setting product prices. Its costs for producing 37,000 units follow. The company targets a profit of $317,000 on this product.
 

Variable Costs per Unit				Fixed Costs
Direct materials	$	87		Overhead	$	687,000
Direct labor		57		Selling		322,000
Overhead		42		Administrative		302,000
Selling		32

 
1. Compute the variable cost per unit .?
2. Compute the markup percentage on variable cost. ?

3. Compute the product’s selling price using the variable cost method .?

Answer rating: 100% (QA)

Part 1 Variable cost per unit 87 57 42 32 218 Part 2 Fixed cost per unit 687000 322000 302000 3700... View the full answer