Business, 05.05.2020 04:46 camerondillonn

Peachtree Doors, Inc. is in the process of setting a target price on its newly designed patio door. Cost data relating to the door at a budgeted volume of 5,000 units is as follows:
Per Unit Total
Direct materials $100
Direct labor 170
Variable
manufacturing
overhead 80
Fixed
manufacturing
overhead $750,000
Variable selling
and
administrative
expenses 25
Fixed selling
and
administrative
expenses 375,000
Peachtree uses cost-plus pricing that provides it with a 25% ROI on its patio door line. A total of $4,000,000 in assets is committed to production of the new door
Compute the following under the absorption-cost approach:
Markup percentage needed to provide desired ROI
Target price of the patio door.

Answers: 2

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Answers

Answer from: dillpickle124617

a) 60%

b) $800

Explanation:

Unit price

Direct materials $100

Direct labor $170

Variable manufacturing overhead $80

Fixed manufacturing overhead ($750,000 ÷ 5,000) $150

Total manufacturing cost = $100 + $170 + $80 + $150 = $500

The mark-up percentage to provide a 25% (0.25) ROI:

Therefore, mark up percentage is given as: $Mark -up=\frac{[ROI*(Total-assets/volume)]+[var.adm.exp+(fix.adm.exp/volume)]}{Total-manufacturing-cost} \\Mark-up=\frac{[0.25*(4000000/5000)]+[25+(375000/5000)]}{500} =\frac{200+100}{500} =0.6$

mark up percentage = 60%

b) Target price = Total manufacturing cost + (Total manufacturing cost × mark up percentage) = $500 + ($500 × 0.6) = $800

Answer from: esnyderquintero

A. 60%

B. $800

Explanation:

Base on the scenario been described in the question, we have the following

Unit price

Direct materials $100

Direct labor $170

Variable manufacturing overhead $80

Fixed manufacturing overhead ($750,000 ÷ 5,000) $150

Cost of manufacturing= $100 + $170 + $80 + $150

Cost of manufacturing = $500

The mark-up percentage to given at 25% (0.25) ROI:

The mark up percentage is given as follows

Our mark up percentage = 60%

b) Target price = Total manufacturing cost + (Total manufacturing cost × mark up percentage) = $500 + ($500 × 0.6) Total target = $800 as our total target

Answer from: Quest

answer: b) the us is the leading importer but not the leading exporter.

extra info:

the u.s is the largest importer but it is not the largest exporter as china sits on the top of the table when it comes to leading exporters.

but u.s is not far from first,

they rank in 2nd globally as the worlds largest exporter.

happy to

pls mark as brainliest

Answer from: Quest

Ibelieve your answer is d

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Peachtree Doors, Inc. is in the process of setting a target price on its newly designed patio door....

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