Rios Company makes drones and uses the variable cost method in setting product price. Its costs for producing 20,000 units follow. The company targets a profit of $300,000 on this product.

Variable Costs per Unit
Direct materials	$ 70
Direct labor	40
Overhead	25
Selling, general and administrative	15

Fixed Costs (total)
Overhead	$ 670,000
Selling, general and administrative	590,000

1. Compute the total variable cost and the markup percentage. 2. Compute the dollar markup per unit on variable cost. 3. Compute the selling price per unit.

Rios Company makes drones and uses the variable cost method in setting product price. Its costs for producing 20,000 units follow. The company targets a profit of $300,000 on this product. Variable costs per Unit Direct materials Direct labor Overhead Selling, general and administrative $ 70 40 25 15 Fixed Costs (total) Overhead $ 670,000 Selling, general and administrative 590,000 1. Compute the total variable cost and the markup percentage. 2. Compute the dollar markup per unit on variable cost. 3. Compute the selling price per unit. $ Answer is complete but not entirely correct. 1. Total variable costs 150 X 1. Markup percentage 52 % 2. Markup per unit $ 78 3. Selling price per unit $ 228