Greenspring produced 10 000 units during January 2017. The pricing policy is to

Question

Greenspring produced 10 000 units during January 2017. The pricing policy is to set the pri per unit at the product cost (per unit) plus 100% mark-up. Presented below are the costs and expenses that are incurred in January 2017 ce Factory electricity cost $10 200 ? Direct labour $69 300 o Factory manager's salary 28 300-perod 5000 48 100 230 500 257 300 8 320 Sales staff salaries o Indirect factory labour Repairs to office equipment 2 300 o Indirect materials Direct materials 9 Factory machinery repairs Marketing costs 8500 Office supplies used 900 periad - Depreciation on office Costs. equipment

Explanation / Answer

Variable costs Direct Labour 69300 Direct Materials 257300 Total Variable cost (a) 326600 No of units (b) 10000 Cost per unit (c=a/b) 32.66 Markup @ 100% (d= c *100%) 32.66 Selling price (c+d) 65.32 Fixed Cost Factory Electricity cost 10200 Factory Manager's Salary 5000 Indirect factorylabour 48100 Indirect Materials 230500 Factory Manchine Repairs 2300 Depreciation in Office Equipment 8320 Sales staff salaries 28300 Repairs to Office Equipment 500 Marketing Costs 8500 Office Supplies used 900 Total(A) 342620 Target Proft (B) 155808 Amount to be recovered C= (A*B) 498428 Contribution per unit (D) 32.66 No of units to be sold (C/D) 15261 Sales 996856 VC 498428 Contribution 498428 Fixed Cost 342620 Profit 155808

Related Questions

Navigate

• Browse (All)
• Browse G
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.