MyPhone, Inc., uses the product cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 5,160 units of cell phones are as follows: Variable costs: Fixed costs: Direct materials $90 per unit Factory overhead $199,200 Direct labor 31 Selling and admin. exp. 70,300 Factory overhead 23 Selling and admin. exp. 22 Total variable cost per unit $166 per unit MyPhone desires a profit equal to a 13% rate of return on invested assets of $600,800. a. Determine the amount of desired profit from the production and sale of 5,160 units of cell phones. $fill in the blank 1 b. Determine the product cost per unit for the production of 5,160 of cell phones. If required, round your answer to nearest dollar. $fill in the blank 2 per unit c. Determine the product cost markup percentage (rounded to two decimal places) for cell phones. fill in the blank 3 % d. Determine the selling price of cell phones. Round to the nearest dollar. Total Cost $fill in the blank 4per unit Markup fill in the blank 5per unit
MyPhone, Inc., uses the product cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 5,160 units of cell phones are as follows: Variable costs: Fixed costs: Direct materials $90 per unit Factory overhead $199,200 Direct labor 31 Selling and admin. exp. 70,300 Factory overhead 23 Selling and admin. exp. 22 Total variable cost per unit $166 per unit MyPhone desires a profit equal to a 13% rate of return on invested assets of $600,800. a. Determine the amount of desired profit from the production and sale of 5,160 units of cell phones. $fill in the blank 1 b. Determine the product cost per unit for the production of 5,160 of cell phones. If required, round your answer to nearest dollar. $fill in the blank 2 per unit c. Determine the product cost markup percentage (rounded to two decimal places) for cell phones. fill in the blank 3 % d. Determine the selling price of cell phones. Round to the nearest dollar. Total Cost $fill in the blank 4per unit Markup fill in the blank 5per unit
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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roduct Cost Method of Product Costing
MyPhone, Inc., uses the product cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 5,160 units of cell phones are as follows:
| Variable costs: | Fixed costs: | ||||||
| Direct materials | $90 | per unit | Factory |
$199,200 | |||
| Direct labor | 31 | Selling and admin. exp. | 70,300 | ||||
| Factory overhead | 23 | ||||||
| Selling and admin. exp. | 22 | ||||||
| Total variable cost per unit | $166 | per unit |
MyPhone desires a profit equal to a 13%
a. Determine the amount of desired profit from the production and sale of 5,160 units of cell phones.
$fill in the blank 1
b. Determine the product cost per unit for the production of 5,160 of cell phones. If required, round your answer to nearest dollar.
$fill in the blank 2 per unit
c. Determine the product cost markup percentage (rounded to two decimal places) for cell phones.
fill in the blank 3 %
d. Determine the selling price of cell phones. Round to the nearest dollar.
| Total Cost | $fill in the blank 4per unit |
| Markup | fill in the blank 5per unit |
| Selling price | $fill in the blank 6per unit |
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