Assuming that Arrow desires to sell its chairs for cost plus 40 percent of cost, what price should be charged for the chairs produced in January and February? (Round intermediate calculations and final answers to 2 decimal places.)
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Arrow Manufacturing Co. expects to make 50,000 chairs during the year 1 accounting period. The company made 3,000 chairs in January. Materials and labor costs for January were $36,000 and $48,000, respectively. Arrow produced 4,000 chairs in February. Material and labor costs for February were $48,000 and $60,000, respectively. The company paid the $480,000 annual rental fee on its manufacturing facility on January 1, year 1. The rental fee is allocated based on the total estimated number of units to be produced during the year.
Required
Assuming that Arrow desires to sell its chairs for cost plus 40 percent of cost, what price should be charged for the chairs produced in January and February? (Round intermediate calculations and final answers to 2 decimal places.)
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- Variable costs per unit: Direct materials $32 Direct labor $12 Factory Overhead $8 Selling and administrative expenses $7 Total variable cost per unit $59 Assume that as of September 1, 7,000 units of halogen light have been produced and sold during the current year. Analysis of the domestic market indicates that 3,000 additional units of the halogen light are expected to be sold during the remainder of the year at the normal product price determined under the product cost method. On September 5, Night Glow Inc. received an offer from Tokyo Lighting Inc. for 1,600 units of the halogen light at $57 each. Tokyo Lighting Inc. will market the units in Japan under its own brand name, and no variable selling and administrative expenses associated with the sale will be incurred by Night Glow Inc. The additional business is not expected to affect the domestic sales of the halogen light, and the additional units could be produced using existing productive, selling, and administrative…< High-Low Method The manufacturing costs of Rosenthal Industries for the first three months of the year follow: Total Costs Production January February $259,200 2,025 units 264,960 3,760 403,200 6,525 Using the high-low method, determine (a) the variable cost per unit and (b) the total fixed cost. a. Variable cost per unit b. Total fixed cost March Check My Work 2 more Check My Work uses remaining.High-Low Method The manufacturing costs of Rosenthal Industries for the first three months of the year follow: January February March Total Costs Production $215,280 1,265 units 264,080 2,130 334,880 3,565 Using the high-low method, determine (a) the variable cost per unit and (b) the total fixed cost. a. Variable cost per unit b. Total fixed cost SA LA