Question

Please show work Product Cost Method of Product Costing MyPhone, Inc., uses the product cost method...

Please show work

Product Cost Method of Product Costing

MyPhone, Inc., uses the product cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 5,190 units of cell phones are as follows:

Variable costs: Fixed costs:
Direct materials $64 per unit Factory overhead $200,900
Direct labor 39 Selling and admin. exp. 70,600
Factory overhead 28
Selling and admin. exp. 18
Total variable cost per unit $149 per unit

MyPhone desires a profit equal to a 15% rate of return on invested assets of $598,200.

a. Determine the amount of desired profit from the production and sale of 5,190 units of cell phones.
$__________

b. Determine the product cost per unit for the production of 5,190 of cell phones. If required, round your answer to nearest dollar.
$_________ per unit

c. Determine the product cost markup percentage (rounded to two decimal places) for cell phones.
________%

d. Determine the selling price of cell phones. Round to the nearest dollar.

Total Cost $_________per unit
Markup __________per unit
Selling price $_________per unit

Homework Answers

Answer #1

Solution a:

Amount of desired profit from the production and sale of 5,190 units of cell phones = $598,200* 15% = $89,730

Solution b:

Product cost per unit for the production of 5,190 of cell phones = Variable production cost + Fixd factory overhead

= ($64 + $39 + $28) + ($200,900 / 5190) = $170 per unit

Solution c:

Required mark up per unit to cover selling expense and profit = $18 + ($70,600 / 5190) + ($89,730 / 5190)

= $48.89 per unit

Product cost markup percentage = $48.89 / $170 = 28.76%

Solution d:

Total cost = $170 per unit

Markup per unit = $48.89 per unit

Selling price = $218.89 per unit

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
#6 Product Cost Method of Product Costing Voice Com, Inc., uses the product cost method of...
#6 Product Cost Method of Product Costing Voice Com, Inc., uses the product cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 4,970 units of cell phones are as follows: Variable costs: Fixed costs: Direct materials $60 per unit Factory overhead $198,500 Direct labor 37 Selling and admin. exp. 71,000 Factory overhead 22 Selling and admin. exp. 21 Total variable cost per unit $140 per unit Voice Com desires a profit equal to...
Product Cost Method of Product Costing Voice Com, Inc., uses the product cost method of applying...
Product Cost Method of Product Costing Voice Com, Inc., uses the product cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 4,750 units of cell phones are as follows: Variable costs: Fixed costs: Direct materials $83 per unit Factory overhead $199,100 Direct labor 35 Selling and admin. exp. 68,400 Factory overhead 26 Selling and admin. exp. 22 Total variable cost per unit $166 per unit Voice Com desires a profit equal to a...
Product Cost Method of Product Costing Voice Com, Inc., uses the product cost method of applying...
Product Cost Method of Product Costing Voice Com, Inc., uses the product cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 4,890 units of cell phones are as follows: Variable costs: Fixed costs: Direct materials $71 per unit Factory overhead $201,300 Direct labor 40 Selling and admin. exp. 71,600 Factory overhead 25 Selling and admin. exp. 18 Total variable cost per unit $154 per unit Voice Com desires a profit equal to a...
Product Cost Method of Product Costing Voice Com, Inc., uses the product cost method of applying...
Product Cost Method of Product Costing Voice Com, Inc., uses the product cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 5,250 units of cell phones are as follows: Variable costs: Fixed costs: Direct materials $89 per unit Factory overhead $200,400 Direct labor 30 Selling and admin. exp. 70,800 Factory overhead 26 Selling and admin. exp. 20 Total variable cost per unit $165 per unit Voice Com desires a profit equal to a...
Variable Cost Method of Product Pricing Smart Stream Inc. uses the variable cost method of applying...
Variable Cost Method of Product Pricing Smart Stream Inc. uses the variable cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 10,000 cell phones are as follows: Variable costs per unit: Fixed costs: Direct materials $150 Factory overhead $350,000 Direct labor 25 Selling and admin. exp. 140,000 Factory overhead 40 Selling and administrative expenses 25 Total variable cost per unit $240 Smart Stream desires a profit equal to a 30% return on invested...
Smart Stream Inc. uses the product cost method of applying the cost-plus approach to product pricing....
Smart Stream Inc. uses the product cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 10,000 cell phones are as follows: Variable costs per unit: Fixed costs: Direct materials $150 Factory overhead $350,000 Direct labor 25 Selling and administrative expenses 140,000 Factory overhead 40 Selling and administrative expenses 25 Total variable cost per unit $240 Smart Stream desires a profit equal to a 30% return on invested assets of $1,200,000. a. Determine the...
Variable Cost Method of Product Pricing Smart Stream Inc. produces and sells cell phones. The costs...
Variable Cost Method of Product Pricing Smart Stream Inc. produces and sells cell phones. The costs of producing and selling 4,500 units of cell phones are as follows: Variable costs: Fixed costs:     Direct materials $ 70 per unit     Factory overhead $141,400     Direct labor 32     Selling and admin. exp. 49,700     Factory overhead 21     Selling and admin. exp. 17      Total variable cost per unit $140 per unit Smart Stream Inc. desires a profit equal to a 15% rate of return on invested...
Product Cost Concept of Product Pricing Willis Products Inc. uses the product cost concept of applying...
Product Cost Concept of Product Pricing Willis Products Inc. uses the product cost concept of applying the cost-plus approach to product pricing. The costs of producing and selling 3,000 units of medical tablets are as follows: Variable costs per unit: Fixed costs: Direct materials $114 Factory overhead $120,000 Direct labor 42 Selling and admin. exp. 39,000 Factory overhead 35 Selling and admin. exp. 29 Total $220 Willis Products desires a profit equal to a 20% rate of return on invested...
Product Cost Concept of Product Pricing Willis Products Inc. uses the product cost concept of applying...
Product Cost Concept of Product Pricing Willis Products Inc. uses the product cost concept of applying the cost-plus approach to product pricing. The costs of producing and selling 3,000 units of medical tablets are as follows: Variable costs per unit: Fixed costs: Direct materials $114 Factory overhead $120,000 Direct labor 42 Selling and admin. exp. 39,000 Factory overhead 35 Selling and admin. exp. 29 Total $220 Willis Products desires a profit equal to a 20% rate of return on invested...
1. Smart Stream Inc. uses the total cost concept of applying the cost-plus approach to product...
1. Smart Stream Inc. uses the total cost concept of applying the cost-plus approach to product pricing. The costs of producing and selling 8,000 units of cellular phones are as follows: Variable costs: Fixed costs:     Direct materials $ 87 per unit     Factory overhead $349,300     Direct labor 40     Selling and admin. exp. 122,700     Factory overhead 26     Selling and admin. exp. 21          Total $174 per unit Smart Stream wants a profit equal to a 15% rate of return on invested assets of...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT