Bonita Products desires to set atarget price for its newest product. Information for a budgeted volume of 8.000 units is shown below. Per Unit Total Direct materials $ 146 Direct labor 96 Variable manufacturing overhead 71 Fixed manufacturing overhead s s0,00 Variable selling and administrative expenses $ 45 Fixed selling and administrative expenses $ 70,000 Bonita Products uses cost-plus pricing and management wants a 25% ROI on the new product. Assets of $1,400,000 are committed to production of the new product. la) Compute the markup percentage untler variable costing that will allow Bonita Products its desired ROI. (Round answer to 2 decimal places, es. 10.50%.) Markup Percentage Save for Later Attempts: 0 of 1 used Submit Answer

Bonita Products desires to set atarget price for its newest product. Information for a budgeted volume of 8.000 units is shown below. Per Unit Total Direct materials $ 146 Direct labor 96 Variable manufacturing overhead 71 Fixed manufacturing overhead s s0,00 Variable selling and administrative expenses $ 45 Fixed selling and administrative expenses $ 70,000 Bonita Products uses cost-plus pricing and management wants a 25% ROI on the new product. Assets of $1,400,000 are committed to production of the new product. la) Compute the markup percentage untler variable costing that will allow Bonita Products its desired ROI. (Round answer to 2 decimal places, es. 10.50%.) Markup Percentage Save for Later Attempts: 0 of 1 used Submit Answer

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Based on a predicted level of production and sales of 24,000 units, a company anticipates total contribution margin of $79,200, fixed costs of $24,000, and operating income of $55,200. Based on this information, the budgeted operating income for 21,000 units would be: Multiple Choice $55,200. $103,200. $45,300. $44,571. $79,200.
Ladle Corporation uses the absorption costing approach to cost-plus pricing described in the text to set prices for its products. Based on budgeted sales of 81,000 units next year, the unit product cost of a particular product is $45.30. The company's selling and administrative expenses for this product are budgeted to be $1,898,000 in total for the year. The company has invested $262,000 in this product and expects a return on investment of 14%. The markup on absorption cost for this product would be: a. 14% b. 52.7% c. 51.7% d. 65.7%
Friday Night, Inc. manufactures high-quality 5-liter boxes of wine which It sells for $14 per box. Below is some information related to Friday Night's capacity and budgeted foed marufacturing costs for 2021; Denominator Level Capacity Concept Days of Hours of Fixed Manufacturing Production ProductionBoxes per Overhead per Period per Perlod per Day Hour Theoretical capacity Practical capacity Normal capacity Master budget capacity $2,500,000 $2.500.000 $2,500.000 $2.500,000 22 300 362 310 310 310 16 250 175 16 16 200 Production during 2021 was 990,000 boxes of wine, with 15,000 remaining in ending inventory at 12/31/21. Actual varlable manufacturing costs were $1,762,200 (there are no varlable cost variances). Actual foed manufacturing overhead costs were $2.500.000. Fixed manufacturing overhead cost variances are written off to cost of goods sold in the period in which they occur. What is gross margin under practical capacity? Hint: don't forget the production-volume variance…
Cleaning Care Inc. expects to sell 9,000 mops. Fixed costs (for the year) are expected to be $13,000, unit sales price is expected to be $11, and unit variable costs are budgeted at $7. Cleaning Care's margin of safety (MOS) in units is:
Prepare a flexible budget for the three sales levels under consideration. Waterway manufactures aluminum canoes. In planning for the coming year, CFO Alexis King is considering three different sales targets: 2,900 canoes, 3,340 canoes, and 3,550 canoes. Canoes sell for $990 each. The standard variable cost information for a canoe is as follows. Direct materials $ 297 Direct labor 112 Variable overhead Utilities 35 Indirect material 30 Indirect labor 60 Total $ 534 Annual fixed overhead cost is expected to be: Maintenance $ 20,600 Depreciation 43,500 Insurance 29,500 Rent 33,690 Total $ 127,290
Skooby Dubby Doo Inc. sells 3 products. Budgeted fixed cost for next period is $10,650. Use the following data to be guided: Product Units Selling Price Variable Cost Skooby 16,000 14 9 Dubby 12,000 10 6 Doo 52,000 11 8 How many units of product Dubby must be sold in order for the firm to earn an operating income of $8,520?
Required information Eckert Company uses the absorption costing approach to cost plus pricing to set prices for its products. Based on budgeted sales of 18.000 units next year, the unit product cost of a particular product is $60.40. The company's selling general, and administrative expenses for this product are budgeted to be $370.800 in total for the year. The company has invested $260.000 in this product and expects a return on investment of T (Appendix 12A) The markup on absorption cost for this product would be closest to which of the following O O O M4T 36.74 ALIK HON 3 Save & Submit
Zizi plc uses a standard absorption costing system and produces and sells product 8W. The standard cost card is below: Product 8W (€ per unit) Direct material (5 per kg) 15 Direct labour (6 per hour) 12 Fixed manufacturing overhead 10 Total production cost 37 Standard profit 13 Standard selling price 50 * Absorption rate based on standard labour hours Budgeted and actual production and sales units for december 2020 were as follows: Budget Actual Production 1,100 900 Sales 1,000 800 Actual data for December 2020 were as follows € Direct material purchases 1,200 kgs costing 12,000 Direct materials used 1,100 kgs Direct labour hours 500 hours costing 6,000 Fixed manufacturing overhead 5,000 Sales revenue 30,000 An analysis of the Direct labour hours shows that the 500 hours that were paid for 50 were idle time due to a machinery breakdown. There were no inventories of Direct materials or finished products (planned or actual) at the…
Given help with this problem is solution
The firm uses the absorption costing approach to cost-plus pricing described in the text to set prices for its products. Based on budgeted sales of 45,000 units next year, the unit product cost of a particular product is ₱15.60. The company's selling, general, and administrative expenses for this product are budgeted to be ₱1,035,000 in total for the year. The company has invested ₱280,000 in this product and expects a return on investment of 11%. The selling price for this product based on the absorption costing approach described would be closest to: a. ₱39.28 b. ₱17.32 c. ₱97.20 d. ₱38.60
Wharton Company has the capacity to produce 50,000 units per year. The company sells each unit for $125. Budgeted information is as follows: Revenues $5,612,000 Direct materials $1,932,000 Direct labor 552,000 Manufacturing overhead (fixed) 276,000 Manufacturing overhead (variable) 552,000 3,312,000 Total $2,300,000 A special order has been received for 5,000 units to be sold for $80 per unit. The company would incur an additional $60,000 in total fixed costs in order to lease a special machine in order to make a slight modification to the original product. Should the company accept the special order? A. Yes, the revenue will increase substantially. B. No, total costs would increase by $303,600. C. Yes, profit will increase by $36,400. D. No, accepting this order would decrease profits to $2,263,600.
Mandy Corporation sells a single product. Budgeted sales for the year are anticipated to be 625,000 units, estimated beginning inventory is 109,000 units, and desired ending inventory is 89,000 units. The quantities of direct materials expected to be used for each unit of finished product are given below.Material A 0.50 lb. per unit @ $0.64 per poundMaterial B 1.00 lb. per unit @ $2.33 per poundMaterial C 1.20 lb. per unit @ $0.78 per poundThe dollar amount of Material B used in production during the year is a.$2,114,475 b.$1,127,720 c.$1,691,580 d.$1,409,650