The dollar amount of desired profit from the production and sale of the company\

Question

The dollar amount of desired profit from the production and sale of the company's product is: a. $ 96,000 b. $105,840 c. $225,000 d. $220,500 31. The markup percentage on product cost for the company's product is: a. b. C. d. 26.1% 23.4% 18% 10.98% 32. The unit selling price for the company's product is a. $15.75 b. $22.05 c. $19.35 d. $21.26 33. The expected average rate of return for a proposed investment of $600,000 in a fixed asset, with a useful life of four years, straight-line depreciation, no residual value, and an expected total net income of $240,000 for the 4 years, is: a. 20% b. 24% c. 60% d. 40% Dotterel Corporation uses the variable cost concept of product pricing. Below is cost information for the production and sale of 35,000 units of its sole product. Dotterel desires a profit equal to a 11.2% rate of return on invested assets of $350,000. Fixed factory overhead cost Fixed selling and administrative costs Variable direct materials cost per unit Variable direct labor cost per unit Variable factory overhead cost per unit Variable selling and administrative cost per unit $105,000 35,000 4.34 5.18 98 70 The markup percentage for the sale of the company's product is: a. b. c. d. 34. 14% 11.2% 45.71% 5.6% The variable cost per unit for the production and sale of the company's product is: a. $11.20 b. $9.80 c. $14.00 d. $12.60 35.

Explanation / Answer

1) Answer (B) 11.2%

Explanation : There will be many chances that the mark up can be given on sales or cost or investment it self. In this particular problem it was given on the investment which is 11.2%.

2) Answer (A) $11.20

Calculation :

Variable cost per unit = $4.34 + $5.18 + $0.98 + $0.70

= $11.20

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