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Heedy Manufacturing is in the process of setting a selling price on a new product it has just developed. The following data is available from the accounting department based on a budgeted volume of 100,000 units. Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and administrative expenses Per Unit $30 $35 $30 $25 Total $250,000 $100,000 Heedy Manufacturing management requests the total cost per unit be used in cost-plus pricing its products. In addition, management requests that the target price be set to provide a 30% return on investment on invested assets of $1,500,000.

Heedy Manufacturing is in the process of setting a selling price on a new product it has just developed. The following data is available from the accounting department based on a budgeted volume of 100,000 units. Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses Fixed selling and administrative expenses Per Unit $30 $35 $30 $25 Total $250,000 $100,000 Heedy Manufacturing management requests the total cost per unit be used in cost-plus pricing its products. In addition, management requests that the target price be set to provide a 30% return on investment on invested assets of $1,500,000.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Heedy Manufacturing is in the process of setting a selling price on a new product it has just developed. The following data is available from the accounting department based on a budgeted volume of 100,000 units. 4 Per Unit Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses $25 Fixed selling and administrative expenses $30 $35 $30 Total $250,000 $100,000 Heedy Manufacturing management requests the total cost per unit be used in cost-plus pricing its products. In addition, management requests that the target price be set to provide a 30% return on investment on invested assets of $1,500,000. hp
Transcribed Image Text:Heedy Manufacturing is in the process of setting a selling price on a new product it has just developed. The following data is available from the accounting department based on a budgeted volume of 100,000 units. 4 Per Unit Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative expenses $25 Fixed selling and administrative expenses $30 $35 $30 Total $250,000 $100,000 Heedy Manufacturing management requests the total cost per unit be used in cost-plus pricing its products. In addition, management requests that the target price be set to provide a 30% return on investment on invested assets of $1,500,000. hp
Your Answer Correct Answer Your answer is correct. Compute the markup percentage and target selling price that will allow Heedy Manufacturing to earn a 30% return on investment. (Round your answers to 2 decimal places, eg 10.50.) Markup percentage Target selling price $ eTextbook and Media (b) Assume that the budgeted volume is 90,000 units and the invested assets for this product are $1,200,000 instead. Compute the markup percentage and target selling price for Heedy Manufacturing to earn a 30% return on investment. (Round answers to 2 decimal places, eg. 10.50% or 10.50) Markup percentage Target selling price $ eTextbook and Media Save for Later Attempts: 2 of 2 used Attempts: 0 of 2 used Submit Answer
Transcribed Image Text:Your Answer Correct Answer Your answer is correct. Compute the markup percentage and target selling price that will allow Heedy Manufacturing to earn a 30% return on investment. (Round your answers to 2 decimal places, eg 10.50.) Markup percentage Target selling price $ eTextbook and Media (b) Assume that the budgeted volume is 90,000 units and the invested assets for this product are $1,200,000 instead. Compute the markup percentage and target selling price for Heedy Manufacturing to earn a 30% return on investment. (Round answers to 2 decimal places, eg. 10.50% or 10.50) Markup percentage Target selling price $ eTextbook and Media Save for Later Attempts: 2 of 2 used Attempts: 0 of 2 used Submit Answer
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