80.2K

Verified Solution

Link Copied!

Question 2 Joey's Recording Studio rents studio time to musicians in 2-hour blocks. Each session includes the use of the studio facilities, a digital recording of the performance, and a professional music producer/mixer. Anticipated annual volume is 1,000 sessions. The company has invested $2,000,000 in the studio and expects a return on investment (ROI) of 16.5%. Budgeted costs for the coming year are as follows. Per Session Total Direct materials (tapes, CDs, etc) $60 Direct labor $400 Variable overhead $50 Fixed overhead $850,000 Variable selling and administrative expenses $40 Fixed selling and administrative expenses $800,000

Determine the total cost per session. Total cost per session: $ LINK TO TEXT

Determine the desired ROI per session. Desired ROI per session $ LINK TO TEXT

Calculate the mark-up percentage on the total cost per session. Mark-up percentage on the total cost per session %

Calculate the target price per session. Target price per session $

Answer & Explanation Solved by verified expert

See Answer