Bramble Corporation needs to set a target price for its newly designed product M14M16. The...
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Accounting
Bramble Corporation needs to set a target price for its newly designed product M14M16. The following data relate to this new product.
| Per Unit | Total | |||||
|---|---|---|---|---|---|---|
| Direct materials | $42 | |||||
| Direct labor | $54 | |||||
| Variable manufacturing overhead | $12 | |||||
| Fixed manufacturing overhead | $1,843,200 | |||||
| Variable selling and administrative expenses | $ 7 | |||||
| Fixed selling and administrative expenses | $ 1,228,800 | |||||
These costs are based on a budgeted volume of 102,400 units produced and sold each year. Bramble uses cost-plus pricing methods to set its target selling price. The markup percentage on total unit cost is 40%
Compute the desired ROI per unit for M14M16.
| Desired ROI |
.
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