Rios Company makes drones and uses the variable cost method in setting product price. Its costs for producing 25,000 units follow. 

The company targets a profit of $305,000 on this product.

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. 

Transcribed Image Text:

Variable Costs per Unit Direct materials Direct labor Overhead selling, general and administrative Fixed Costs (total) Overhead selling, general and administrative 5 $.75 45 30 20 $ 675,000 600,000 Variable Costs per Unit Direct materials Direct labor Overhead selling, general and administrative Fixed Costs (total) Overhead selling, general and administrative 5 $.75 45 30 20 $ 675,000 600,000

Answer rating: 100% (QA)

1 Variable cost per unit 170 2 Markup percentage 3897 3 Selling pr... View the full answer