Answer:
price for a new product is $50
Explanation:
given data
expects sell = 5,020 units
Variable product = $16 cost per unit
Variable administrative = 11 cost per unit
Total fixed overhead = 45,100
Total fixed administrative = 20,160
to find out
price for a new product
solution
first we get here Variable product cost and Variable administrative cost that is
Variable product cost = $16 × 5020
Variable product cost = $80320
and
Variable administrative cost = $11 × 5020
Variable administrative cost = $55220
so
total coast is = $80320 + $55220 + $45,100 + $20,160
total coast is = $200800
and
Total cost per unit will be = [tex]\frac{200800}{5020}[/tex]
Total cost per unit will be $40
and Mark up @ 25 = 0.25 × $40
mark up = $10
so Selling Price will be = Total cost per unit + mark up
Selling Price = $40 + ₹10
selling price = $50
