Question
In: Accounting
Voice Com, Inc., uses the product cost method of applying the cost-plus approach to product pricing....
Voice Com, Inc., uses the product cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 5,010 units of cell phones are as follows:
| Variable costs: | Fixed costs: | |||||||
| Direct materials | $62 | per unit | Factory overhead | $200,200 | ||||
| Direct labor | 38 | Selling and admin. exp. | 69,900 | |||||
| Factory overhead | 26 | |||||||
| Selling and admin. exp. | 20 | |||||||
| Total variable cost per unit | $146 | per unit | ||||||
Voice Com desires a profit equal to a 16% rate of return on invested assets of $599,000.
a. Determine the amount of desired profit from
the production and sale of 5,010 units of cell phones.
$fill in the blank 1
b. Determine the product cost per unit for the
production of 5,010 of cell phones. If required, round your answer
to nearest dollar.
$fill in the blank 2 per unit
c. Determine the product cost markup percentage
(rounded to two decimal places) for cell phones.
fill in the blank 3 %
d. Determine the selling price of cell phones. Round to the nearest dollar.
| Total Cost | $fill in the blank 4per unit |
| Markup | fill in the blank 5per unit |
| Selling price | $fill in the blank 6per unit |
Solutions
Expert Solution
a)
Amount of desired profit = rate of return on investment x invested assets = 16% x $599,000 = $95,840
b)
Direct Material = $ 62
+Direct Labour = $ 38
+Variable Factory Overhead = $ 26
+Fixed Factory Overhead = $ 40
( 200,200/5,010 = 40 )
Product cost per unit = $166
c) Calculation of Product Cost Markup % :
Total Product Cost = 5010 x 166 = $831,660
+Total Variable Selling and Admin expenses = 20 x 5,010 = $100,200
+Total Fixed Selling and Admin expenses = $ 69,900
+Desired Profit = $ 95,840
Sales =$1,097,600
Total Markup over Product Cost = $1,097,600 - $831,660 = $265,940
Product Cost Markup % = Markup over Product Cost/Total Product Cost = 265,940/831,660 = 0.31977 = 31.98%
Note:
You can also find Product Cost Markup % by adding Total Variable Selling and Admin Expenses, Total Fixed Selling and Admin Expenses, and Desired Profit and dividing the result with Total Product Cost
d) Product Cost per unit = $166.00
+Markup = 31.98% x 166 = $ 53.00 (approx)
Selling Price = $219.00
ekkarill92 answered 1 year agoRelated Solutions
MyPhone, Inc. uses the product cost method of applying the cost-plus approach to product pricing. The...
MyPhone, Inc. uses the product cost method of applying the
cost-plus approach to product pricing. The costs of producing and
selling 5,380 cell phones are as follows:
Variable costs per unit:
Fixed costs:
Direct materials
$64
Factory overhead
$198,000
Direct labor
31
Selling and administrative expenses
71,300
Factory overhead
23
Selling and administrative expenses
21
Total variable cost per unit
$139
MyPhone desires a profit equal to a 16% rate of return on
invested assets of $600,700.
a. Determine the...
MyPhone, Inc. uses the product cost method of applying the cost-plus approach to product pricing. The...
MyPhone, Inc. uses the product cost method of applying the
cost-plus approach to product pricing. The costs of producing and
selling 5,380 cell phones are as follows:
Variable costs per unit:
Fixed costs:
Direct materials
$64
Factory overhead
$198,000
Direct labor
31
Selling and administrative expenses
71,300
Factory overhead
23
Selling and administrative expenses
21
Total variable cost per unit
$139
MyPhone desires a profit equal to a 16% rate of return on
invested assets of $600,700.
a. Determine the...
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 5,320 cell phones are as follows:
Variable costs per unit:
Fixed costs:
Direct materials
$76
Factory overhead
$199,000
Direct labor
30
Selling and administrative expenses
69,100
Factory overhead
22
Selling and administrative expenses
18
Total variable cost per unit
$146
Voice Com desires a profit equal to a 15% rate of return...
Product Cost Method of Product Costing Voice Com, Inc., uses the product cost concept of applying...
Product Cost Method of Product Costing
Voice Com, Inc., uses the product cost concept of applying the
cost-plus approach to product pricing. The costs of producing and
selling 4,700 units of cell phones are as follows:
Variable costs:
Fixed costs:
Direct materials
$74
per unit
Factory overhead
$200,400
Direct labor
31
Selling and admin. exp.
69,000
Factory overhead
25
Selling and admin. exp.
21
Total variable cost per unit
$151
per unit
Voice Com desires a profit equal to a...
Product Cost Method of Product Costing Voice Com, Inc., uses the product cost concept of applying...
Product Cost Method of Product Costing
Voice Com, Inc., uses the product cost concept of applying the
cost-plus approach to product pricing. The costs of producing and
selling 4,700 units of cell phones are as follows:
Variable costs:
Fixed costs:
Direct materials
$74
per unit
Factory overhead
$200,400
Direct labor
31
Selling and admin. exp.
69,000
Factory overhead
25
Selling and admin. exp.
21
Total variable cost per unit
$151
per unit
Voice Com desires a profit equal to a...
Product Cost Method of Product Costing Voice Com, Inc., uses the product cost concept of applying...
Product Cost Method of Product Costing
Voice Com, Inc., uses the product cost concept of applying the
cost-plus approach to product pricing. The costs of producing and
selling 4,700 units of cell phones are as follows:
Variable costs:
Fixed costs:
Direct materials
$74
per unit
Factory overhead
$200,400
Direct labor
31
Selling and admin. exp.
69,000
Factory overhead
25
Selling and admin. exp.
21
Total variable cost per unit
$151
per unit
Voice Com desires a profit equal to a...
Smart Stream Inc. uses the total cost method of applying the cost-plus approach to product pricing....
Smart Stream Inc. uses the total cost method of applying the
cost-plus approach to product pricing. The costs of producing and
selling 7,500 units of cell phones are as follows:
Variable costs:
Fixed costs:
Direct materials
$ 85
per unit
Factory overhead
$321,900
Direct labor
39
Selling and administrative
expenses
113,100
Factory overhead
26
Selling and administrative
expenses
20
Total
variable cost per unit
$170
per unit
Smart Stream desires a profit equal to a 14% return on invested
assets...
RooPhone Inc. uses the product cost concept of applying the cost-plus approach to product pricing. The...
RooPhone Inc. uses the product cost concept of
applying the cost-plus approach to product pricing. The costs of
producing and selling 5,000 units of cellular phones are as
follows: (7 points)
Variable
costs Fixed
Costs:
Direct materials
$625,000 Factory
overhead $215,000
Direct
labor 225,000 Selling
& Admin.
expenses
75,000
Factory
Overhead
200,000
Selling & admin. Exp. 150,000
$1,200,000
RooPhone desires a profit equal to a 18% rate of return on
invested assets of $550,000.
Required:
a.) Determine the amount of desired profit.
b.) Determine...
RooPhone Inc. uses the product cost concept of applying the cost-plus approach to product pricing. The...
RooPhone Inc. uses the product cost concept of applying the
cost-plus approach to product pricing. The costs of producing and
selling 5,000 units of cellular phones are as follows: (7 points)
Variable costs Fixed Costs: Direct materials $625,000 Factory
overhead $215,000 Direct labor 225,000 Selling & Admin.
expenses 75,000 Factory Overhead 200,000 Selling & admin. Exp.
150,000 $1,200,000 RooPhone desires a profit equal to a 18% rate of
return on invested assets of $550,000. Required: a.) Determine the
amount of...
Bluebird Inc. uses the product cost concept of applying the cost-plus approach to product pricing. The...
Bluebird Inc. uses the product cost concept of applying the
cost-plus approach to product pricing. The costs and expenses of
producing 25,000 units of Product K are as follows:
Variable costs: $2.50
Direct Materials 4.25
Direct Labor 1.25
Factory Overhead 0.50
Total: 8.50
Fixed Costs $25,000
Selling and Administrative expenses 17,000
Bluebird desires a profit equal to a 5% rate of return on
invested assets of $642,500
a) determine the amount of desired profit from the production
and sale of...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- function X=extractDWT(x_train,startS,endS,wStep,wRange) % x_train = input signal % startS = from second % endS = end...
- Do you agree that Social Loafing is similar to Theory X. Give an example to support...
- Computing Cost of Goods Sold and Ending Inventory. Bartov Corporation reports the following beginning inventory and...
- SQL FORMAT (11-13 are completed and correct) -- 11. what are the names of all students...
- You have been hired as a capital budgeting analyst by Advent Sports, a sporting goods firm...
- DESCRIBE WHAT HAPPENS WHEN WE BECOME CONSCIOUS OF SOMETHING. WHAT HAS TO HAPPEN FOR CONSCIOUS AWARENESS...
- 3) You are rolling a 12 sided die 8 times. a) What is the size for...
ADVERTISEMENT