Voice Com, Inc., uses the product cost method of applying the cost-plus approach to product...
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Accounting
Voice Com, Inc., uses the product cost method of applying the cost-plus approach to product pricing. The costs of producing and selling 4,530 units of cell phones are as follows:
Variable costs:
Fixed costs:
Direct materials
$62
per unit
Factory overhead
$199,900
Direct labor
40
Selling and admin. exp.
71,500
Factory overhead
26
Selling and admin. exp.
23
Total variable cost per unit
$151
per unit
Voice Com desires a profit equal to a 15% rate of return on invested assets of $599,900.
a. Determine the amount of desired profit from the production and sale of 4,530 units of cell phones. $
b. Determine the product cost per unit for the production of 4,530 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
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