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Homework answers / question archive / Mussatto Corporation produces snowboards
Mussatto Corporation produces snowboards. The following per unit cost Information Is available: direct materials $12, direct labor $4, variable manufacturing overhead $9, fixed manufacturing overhead $10, variable selling and administrative expenses $5, and fixed selling and administrative expenses $12. Using a 45% markup percentage on total per unit cost, compute the target selling price. (Round answer to 2 decimal places, e.g. 10.50.)
Computation of Target Selling Price:
Target Selling Price = Total Cost * (1+Markup)
Here,
Total Cost = Direct material+Direct labor+Variable Manufacturing Overhead+Fixed Manufacturing Overhead+Variable selling and administrative expenses + Fixed selling and administrative expenses
= $12 + $4 + $9 + $10 + $5 + $12
Total Cost = $52
Markup Percentage = 45%
Target Selling Price = $52*(1+45%) = $75.40
