Kirk Co.manufactures mobile cellular equipment and develops a price for the product by using a variable cost concept.Kirk incurs variable costs of $1,900,000 in the production of 100,000 units.Fixed costs total $50,000.The company employs $4,725,000 of assets and wishes to earn a profit equal to a 10% rate of return on assets.
(a)Compute a markup percentage based on the variable costs concept.
(b)Determine a selling price.

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The Answer of Kirk Co.manufactures mobile cellular equipment and develops a price for the product by using a variable cost concept.Kirk incurs variable costs of $1,900,000 in the production of 100,000 units.Fixed costs total $50,000.The company employs $4,725,000 of assets and wishes to earn a profit equal to a 10% rate of return on assets.
(a)Compute a markup percentage based on the variable costs concept.
(b)Determine a selling price.

Kirk Comanufactures Mobile Cellular Equipment and Develops a Price for the the Product