91.The markup percentage on product cost for the company's product is
a. 23.4%
b. 10.98%
c. 26.1%
d. 18%
92.The unit selling price for the company's product is
a. $19.35
b. $15.75
c. $22.05
d. $21.25
93.What pricing concept considers the price that other providers charge for the same product?
a.demand-based concept
b.total cost concept
c.cost-plus concept
d.competition-based concept
Flyer Company sells a product in a competitive marketplace. Market analysis indicates that its product wouldprobably sell at $48 per unit. Flyer management desires a 12.5% profit margin on sales. Their current full cost forthe product is $44 per unit.
94.What is the desired profit per unit?
a.$6
b.$8
c.$5
d.$4
95.Which equation better describes target costing?
a.Selling price – Desired profit = Target costs
b.Selling price + Profit = Target costs
c.Target variable costs + Contribution margin = Selling price
d.Selling price = Profit – Target variable costs
Flyer Company sells a product in a competitive marketplace. Market analysis indicates that its product wouldprobably sell at $48 per unit. Flyer management desires a 12.5% profit margin on sales. Their current full cost forthe product is $44 per unit.
96.If the company meets the new target cost number, how much will it have to cut costs per unit, if any?
a.$1
b.$3
c.$2
d.$0
97.Using the variable cost concept, determine the markup per unit for 30,000 units using the following data:
Variable cost per unit
|
$15.00
|
Total fixed costs
|
$90,000
|
Desired profita. $10
|
$150,000
|
b. $15
|
|
c. $8
|
|
d. $23
|
|
ANSWER:
|
c
|
DIFFICULTY:Moderate
Bloom's: Applying
LEARNING OBJECTIVES:FNMN.WARD.16.24-02 - LO: 24-02
ACCREDITING STANDARDS:ACCT.ACBSP.APC.33 - Incremental analysis
ACCT.IMA.11 - Strategic PlanningBUSPROG: Analytic
The Swan Company produces its product at a total cost of $43 per unit. Of this amount, $8 per unit is selling andadministrative costs. The total variable cost is $30 per unit and the desired profit is $20 per unit.
98.Determine the markup percentage on product cost.
a. 80%
b. 46.5%
c. 70%
d. 110%
Flyer Company sells a product in a competitive marketplace. Market analysis indicates that its product wouldprobably sell at $48 per unit. Flyer management desires a 12.5% profit margin on sales. Their current full cost forthe product is $44 per unit.
99.What is the target cost of the company’s product?
a. $44
b. $42
c. $43
d. $40
100.Using the variable cost concept, determine the selling price for 30,000 units using the following data:
Variable cost per unit
|
$15.00
|
Total fixed costs
|
$90,000
|
Desired profita. $10
|
$150,000
|
b. $15
|
|
c. $8
|
|
d. $23
|
|
Flyer Company sells a product in a competitive marketplace. Market analysis indicates that its product wouldprobably sell at $48 per unit. Flyer management desires a 12.5% profit margin on sales. Their current full cost forthe product is $44 per unit.