Question: Smart Stream Inc. uses the total cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 6,000 units

Smart Stream Inc. uses the total cost method of applying the cost-plus

Smart Stream Inc. uses the total cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 6,000 units of cell phones are as follows: Variable costs per unit: Direct materials $90 Direct labor 41 Factory overhead 27 Selling and administrative expenses 22 Total variable cost per unit $180 Fixed costs: Factory overhead $270,800 Selling and administrative expenses 95,200 Smart Stream desires a profit equal to a 16% return on invested assets of $723,000. a. Determine the total costs and the total cost amount per unit for the production and sale of 6,000 cell phones. Round the cost per unit to two decimal places. Total cost Total cost amount per unit b. Determine the total cost markup percentage for cell phones. Round your answer to two decimal places. % c. Determine the selling price of cell phones. Round to the nearest cent. per cell phone

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock

a To determine the total costs and the total cost amount per unit for the production and sale of 600... View full answer

blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Document Format (2 attachments)

PDF file Icon

664325882c53a_952188.pdf

180 KBs PDF File

Word file Icon

664325882c53a_952188.docx

120 KBs Word File

Students Have Also Explored These Related Accounting Questions!