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Smart Stream Inc. uses the total cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 7,000 units of cell phones are as follows: Variable costs per unit: Direct materials Direct labor Factory overhead Selling and administrative expenses Total variable cost per unit Fixed costs: Factory overhead $305,600 Selling and administrative expenses 107,400 Smart Stream desires a profit equal to a 15% return on invested assets of $848,120. a. Determine the total costs and the total cost amount per unit for the production and sale of 7,000 cell phones. Round the cost per unit to two decimal places. Total cast Total cost amount per unit $87 40 26 21 $174 b. Determine the total cost markup percentage for cell phones. Round your answer to two decimal places. % c. Determine the selling price of cell phones. Round to the nearest cent. per cell phone

Smart Stream Inc. uses the total cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 7,000 units of cell phones are as follows: Variable costs per unit: Direct materials Direct labor Factory overhead Selling and administrative expenses Total variable cost per unit Fixed costs: Factory overhead $305,600 Selling and administrative expenses 107,400 Smart Stream desires a profit equal to a 15% return on invested assets of $848,120. a. Determine the total costs and the total cost amount per unit for the production and sale of 7,000 cell phones. Round the cost per unit to two decimal places. Total cast Total cost amount per unit $87 40 26 21 $174 b. Determine the total cost markup percentage for cell phones. Round your answer to two decimal places. % c. Determine the selling price of cell phones. Round to the nearest cent. per cell phone

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Smart Stream Inc. uses the total cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 7,000 units of cell phones are as follows: Variable costs per unit: Direct materials Direct labor Factory overhead Selling and administrative expenses Total variable cost per unit Total cost $87 Total cost amount per unit 40 26 21 Fixed costs: Factory overhead $305,600 Selling and administrative expenses 107,400 Smart Stream desires a profit equal to a 15% return on invested assets of $848,120. a. Determine the total costs and the total cost amount per unit for the production and sale of 7,000 cell phones. Round the cost per unit to two decimal places. $174 b. Determine the total cost markup percentage for cell phones. Round your answer to two decimal places. % c. Determine the selling price of cell phones. Round to the nearest cent. per cell phone
Transcribed Image Text:Smart Stream Inc. uses the total cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 7,000 units of cell phones are as follows: Variable costs per unit: Direct materials Direct labor Factory overhead Selling and administrative expenses Total variable cost per unit Total cost $87 Total cost amount per unit 40 26 21 Fixed costs: Factory overhead $305,600 Selling and administrative expenses 107,400 Smart Stream desires a profit equal to a 15% return on invested assets of $848,120. a. Determine the total costs and the total cost amount per unit for the production and sale of 7,000 cell phones. Round the cost per unit to two decimal places. $174 b. Determine the total cost markup percentage for cell phones. Round your answer to two decimal places. % c. Determine the selling price of cell phones. Round to the nearest cent. per cell phone
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