Question: Solve the problem on the page HW: CH 08, PRICING Question 3. Whispering Winds Company makes swimsuits and sells these suits directly to retailers. Although
Solve the problem on the page
HW: CH 08, PRICING Question 3. Whispering Winds Company makes swimsuits and sells these suits directly to retailers. Although Whispering Winds has a variety of suits, it does not make the Performance suit used by highly skilled swimmers. The market research department believes that a strong market exists for this type of suit. The department indicates that the Performance suit would sell for approximately $100. Given its experience, Whispering Winds believes the Performance suit would have the following manufacturing costs. Direct materials $30 Direct labor a4 ts Manufacturing overhead 36 Total costs $100 (a1) Assume that Whispering Winds uses cost-plus pricing, setting the selling price 24% above its costs. What would be the price charged for the Performance swimsuit? Sellingprice $ (b) Assume that Whispering Winds uses target costing. What is the price that Whispering Winds would charge the retailer for the Performance swimsuit? Sellingprice $Step by Step Solution
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