C. Smith & Company Limited have recently decided to launch a new product called Maximum Force 2. Based on studies done by the staff, the following data has been made available to you. Estimated Costs (all variable): Per unit Materials 4.00 Direct labour 0.60 Variable overheads 2.20 6.80 Selling expenses is estimated at 20% of the selling price. The client asks you to assume fixed cost is nil as it has already written off the plant and machinery required to produce this product. What selling price must be set to earn a profit of $1.20 per unit?



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