Dotterel Corporation uses the variable cost concept of product pricing. Below is the cost information fo the production and sale of 35,000 units of its sole product. Dotterel desires a profit equal to an 11.2% rate of return on invested assets of $350,000. Fixed factory overhead cost Fixed selling and administrative costs Variable direct materials cost per unit Variable direct labor cost per unit Variable factory overhead cost per unit Variable selling and administrative cost per unit $105,000 35,000 4.34 5.18 0.98 0.70 The dollar amount of the desired profit from the production and sale of the company's product is a. $39,200 b. $70,000 c. $84,000 d. $89,600
Dotterel Corporation uses the variable cost concept of product pricing. Below is the cost information fo the production and sale of 35,000 units of its sole product. Dotterel desires a profit equal to an 11.2% rate of return on invested assets of $350,000. Fixed factory overhead cost Fixed selling and administrative costs Variable direct materials cost per unit Variable direct labor cost per unit Variable factory overhead cost per unit Variable selling and administrative cost per unit $105,000 35,000 4.34 5.18 0.98 0.70 The dollar amount of the desired profit from the production and sale of the company's product is a. $39,200 b. $70,000 c. $84,000 d. $89,600
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Dotterel Corporation uses the variable cost concept of product pricing. Below is the cost information for
the production and sale of 35,000 units of its sole product. Dotterel desires a profit equal to an 11.2%
rate of return on invested assets of $350,000.
Fixed factory overhead cost
Fixed selling and administrative costs
Variable direct materials cost per unit
Variable direct labor cost per unit
Variable factory overhead cost per unit
Variable selling and administrative cost per unit
$105,000
35,000
4.34
5.18
0.98
0.70
The dollar amount of the desired profit from the production and sale of the company's product is
a. $39,200
b. $70,000
c. $84,000
O d. $89,600
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