Question 3: (12 marks) (B1, C2) The DELL Company is in the process of developing...
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Accounting
Question 3: (12 marks) (B1, C2) The DELL Company is in the process of developing a new product called (ZZ). The product current design carries with it following costs: Statements Total variable production costs Fixed manufacturing overhead Total production costs Total selling, general, and administrative expenses Total costs and expenses Total Costs 780,000 220,000 1,000,000 400,000 1,400,000 Units to be Produced 40,000. The company requires a $ 320.000 profit, and 20% return on assets (ROA). The company uses assets totaling $ 1.600.000 in producing. Instructions: a. Compute the price of (ZZ) using the Gross margin pricing method. (4 marks) b. Compute the price of (ZZ) using the Return on assets pricing method. (4 marks) c. Prepare income statement to support your answer. (4 marks)
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