the design and specification of its customers, and accordingly uses the job order costing system.  In March 2022, it finished 10,000 pieces for a customer at a cost of P50.00 per unit for direct materials and P40.00 per unit for direct labor.  Factory overhead is applied at 100% of direct labor cost.  The production incurred 500 defective units due to an error in the specifications made by the customer and that had to be reworked at a direct labor cost of P10.00 per unit.  If the customer is billed at 25%

Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter2: Job Order Costing
Section: Chapter Questions
Problem 3CMA: Lucy Sportswear manufactures a specialty line of T-shirts using a job order cost system. During...
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Lico, Inc. manufactures item “B500” per the design and specification of its customers, and accordingly uses the job order costing system.  In March 2022, it finished 10,000 pieces for a customer at a cost of P50.00 per unit for direct materials and P40.00 per unit for direct labor.  Factory overhead is applied at 100% of direct labor cost.  The production incurred 500 defective units due to an error in the specifications made by the customer and that had to be reworked at a direct labor cost of P10.00 per unit. 

If the customer is billed at 25% above cost, how much is the billing price?

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