Total Cost Concept of Product Pricing Smart Stream Inc. uses the total cost concept of applying the cost-plus approach to product pricing. The costs of producing and selling 8,500 cellular phones are as follows: Variable costs: Fixed costs: Direct materials $ 71 Factory overhead $301,900 Direct labor 33 Selling and administrative expenses 106,100 Factory overhead 21 Selling and administrative expenses 17 Total $142 Smart Stream wants a profit equal to a 16% rate of return on invested assets of $767,130. a. Determine the total costs and the total cost amount per unit for the production and sale of 8,500 units of cellular phones. Total costs $fill in the blank Cost amount per unit $fill in the blank b. Determine the total cost markup percentage for cellular phones. Rounded to two decimal places. fill in the blank % c. Determine the selling price of cellular phones. Round to the nearest cent. $fill in the blank per phone
Total Cost Concept of Product Pricing Smart Stream Inc. uses the total cost concept of applying the cost-plus approach to product pricing. The costs of producing and selling 8,500 cellular phones are as follows: Variable costs: Fixed costs: Direct materials $ 71 Factory overhead $301,900 Direct labor 33 Selling and administrative expenses 106,100 Factory overhead 21 Selling and administrative expenses 17 Total $142 Smart Stream wants a profit equal to a 16% rate of return on invested assets of $767,130. a. Determine the total costs and the total cost amount per unit for the production and sale of 8,500 units of cellular phones. Total costs $fill in the blank Cost amount per unit $fill in the blank b. Determine the total cost markup percentage for cellular phones. Rounded to two decimal places. fill in the blank % c. Determine the selling price of cellular phones. Round to the nearest cent. $fill in the blank per phone
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter11: Differential Analysis And Product Pricing
Section: Chapter Questions
Problem 17E: Product cost method of product costing Smart Stream Inc. uses the product cost method of applying...
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Total Cost Concept of Product Pricing
Smart Stream Inc. uses the total cost concept of applying the cost-plus approach to product pricing. The costs of producing and selling 8,500 cellular phones are as follows:
| Variable costs: | Fixed costs: | |||
| Direct materials | $ 71 | Factory |
$301,900 | |
| Direct labor | 33 | Selling and administrative expenses | 106,100 | |
| Factory overhead | 21 | |||
| Selling and administrative expenses | 17 | |||
| Total | $142 |
Smart Stream wants a profit equal to a 16% rate of
a. Determine the total costs and the total cost amount per unit for the production and sale of 8,500 units of cellular phones.
| Total costs | $fill in the blank |
| Cost amount per unit | $fill in the blank |
b. Determine the total cost markup percentage for cellular phones. Rounded to two decimal places.
fill in the blank %
c. Determine the selling price of cellular phones. Round to the nearest cent.
$fill in the blank per phone
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