Moon Company uses the variable cost concept of applying the cost-plus approach to product pricing.The costs and expenses of producing and selling 75,000 units of Product T are as follows:
Variable costs:
Moon desires a profit equal to an18% rate of return on invested assets of $1,440,000.
a Determine the amount of desired profit from the production and sale of Product T.
b Determine the total variable costs for the production and sale of 75,000 units of Product T.
c Determine the markup percentage for Product T.
d Determine the unit selling price of Product T.

Question

Moon Company uses the variable cost concept of applying the cost-plus approach to product pricing.The costs and expenses of producing and selling 75,000 units of Product T are as follows:
Variable costs:
  Moon desires a profit equal to an18% rate of return on invested assets of $1,440,000.
a Determine the amount of desired profit from the production and sale of Product T.
b Determine the total variable costs for the production and sale of 75,000 units of Product T.
c Determine the markup percentage for Product T.
d Determine the unit selling price of Product T.

Quizplus · Accepted Answer

The Answer of Moon Company uses the variable cost concept of applying the cost-plus approach to product pricing.The costs and expenses of producing and selling 75,000 units of Product T are as follows:
Variable costs:
  Moon desires a profit equal to an18% rate of return on invested assets of $1,440,000.
a Determine the amount of desired profit from the production and sale of Product T.
b Determine the total variable costs for the production and sale of 75,000 units of Product T.
c Determine the markup percentage for Product T.
d Determine the unit selling price of Product T.

Moon Company Uses the Variable Cost Concept of Applying the Cost-Plus