Chapter 25, Problem 11E

Requirement-1:

To determine

The Total Cost per unit

To determine

Concept Introduction:

Direct Costs:

Direct Costs are costs incurred in the production of a product that are easily traceable to the product. Direct material is the material used in the production of product that is easily traceable. For example wood used in making chairs.

Indirect Costs:

Indirect Costs are costs incurred in the production of a product that are not easily traceable to the product. Indirect costs include indirect material, indirect labor and overheads.

Requirement-2:

The Markup Percentage on Total Cost

To determine

Concept Introduction:

Direct Costs:

Direct Costs are costs incurred in the production of a product that are easily traceable to the product. Direct material is the material used in the production of product that is easily traceable. For example wood used in making chairs.

Indirect Costs:

Indirect Costs are costs incurred in the production of a product that are not easily traceable to the product. Indirect costs include indirect material, indirect labor and overheads.

Requirement-3:

The Selling price using the Total Cost method