The Bayducks, Inc. started operations in 2003 with an expected production of 120,000 units and sales volume of 110,000 units. It has a normal operating capacity of 100,000 units. The following data were made available: Variable manufacturing cost per unit P25.40 Fixed manufacturing cost per unit based on normal capacity 5.20 Variable selling and administrative cost per unit 6.60 Annual fixed selling and administrative expenses P240,000 Plant assets (fixed capital) used in operations 900,000 Expected ratio of current assets to projected sales 30% The company is projecting a selling price that would give them a 25% return on investment. REQUIRED: Compute the selling price per unit that will meet the expected results based on the above data. Show proof of answer.
The Bayducks, Inc. started operations in 2003 with an expected production of 120,000 units and sales volume of 110,000 units. It has a normal operating capacity of 100,000 units. The following data were made available:
Variable
Fixed manufacturing cost per unit based on normal capacity 5.20
Variable selling and administrative cost per unit 6.60
Annual fixed selling and administrative expenses P240,000
Plant assets (fixed capital) used in operations 900,000
Expected ratio of current assets to projected sales 30%
The company is projecting a selling price that would give them a 25%
REQUIRED: Compute the selling price per unit that will meet the expected results based on the above data. Show proof of answer.
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