The Grass Doctor

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Rita Corporation produces commercial fertilizer spreaders. The following information is available for Rita's anticipated annual volume of 400,000 units.Direct materials per unit = $42Direct labor per unit = $54Variable manufacturing overhead per unit = $72Fixed manufacturing overhead total = $12,000,000Variable selling and administrative expenses per unit = $84Fixed selling and administrative expenses total =$7,200,000The company has a desired ROI of 25%. It has invested assets of $144,000,000.Instructions:Compute each of the following:1. Total cost per unit.2. Desired ROI per unit.3. Markup percentage using total cost per unit.

Public Comments

1. Plug this info into an income statement and solve for the unknowns. Then convert to the cost per unit. If you do your own homework, you'll learn more.