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Product Cost Concept of Product Pricing
Mademoiselle Company produces women's handbags. The cost of producing 1,160 handbags is as follows:
| Direct materials | $14,600 |
| Direct labor | 8,500 |
| Factory overhead | 6,000 |
| Total manufacturing cost | $29,100 |
The selling and administrative expenses are $28,500. The management desires a profit equal to 17% of invested assets of $498,000.
If required, round your answers to nearest whole number.
a. Determine the amount of desired profit from the production and sale of 1,160 handbags. 84,660$
b. Determine the product cost per unit for the production of 1,160 handbags. $ per unit
c. Determine the product cost markup percentage for handbags. %
d. Determine the selling price of handbags. Round your answers to nearest whole value.
| Cost | $ per unit |
| Markup | $ per unit |
| Selling price | $ per unit |
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