Exercise et B Palawan Company must determine a target selling price for one of its products. Cost data relating to the product are as follows: Per Unit Direct materials P 30 Direct labor Variable manufacturing overhead Fixed manufacturing overhead 15 50. Variable selling expenses Fixed administrative and expenses 40 The costs above are based on an anticipated volume of 70,000 units produced and sold each period. The company uses cost-plus pricing, and it has a policy of obtaining target selling prices by adding a markup of 50% of unit manufacturing cost or by adding a markup of 80% of variable costs. Required: 1. Compute the target selling price per unit using absorption costing. 2. Compute the target selling price per unit using contribution costing.
Exercise et B Palawan Company must determine a target selling price for one of its products. Cost data relating to the product are as follows: Per Unit Direct materials P 30 Direct labor Variable manufacturing overhead Fixed manufacturing overhead 15 50. Variable selling expenses Fixed administrative and expenses 40 The costs above are based on an anticipated volume of 70,000 units produced and sold each period. The company uses cost-plus pricing, and it has a policy of obtaining target selling prices by adding a markup of 50% of unit manufacturing cost or by adding a markup of 80% of variable costs. Required: 1. Compute the target selling price per unit using absorption costing. 2. Compute the target selling price per unit using contribution costing.
Chapter5: Process Costing
Section: Chapter Questions
Problem 2PB: The following product costs are available for Kellee Company on the production of eyeglass frames:...
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