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Question
A company expects to produce and sell a single product. Management desires a 13% return on assets of $2,100,000. The following additional company information is available:
| Variable costs (per unit) | |
| Production costs | $62 |
| Nonproduction costs | $8 |
| Fixed costs (in total) | |
| Overhead | $521,280 |
| Nonproduction | $397,824 |
Required:
Compute selling price per unit given that markup percentage equals desired profit divided by total costs under the following independent assumptions:
a. The company produced and sold 19,200 units
b. The company produced and sold 114,888 units
Answer
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