7. Gold Company has budgeted the following costs for the production of its only product: Direct Materials $75,000 Direct Labor 50,000 Variable indirect production costs 25,000 Fixed indirect production costs 27,500 Variable selling and administrative costs 7,500 Fixed selling and administrative costs 15,000 Total Costs $200,000 Gold Company wants a profit of $100,000, and expects to produce 2,500 units. The market price is $125 per unit. What is the target cost per unit of the product

$68 = unitary variable cost

Explanation:

Giving the following formula:

Gold Company wants a profit of $100,000

Production= 2,500 units

Selling price= $125

Fixed indirect production costs 27,500

Fixed selling and administrative costs 15,000

To calculate the target total unitary variable cost, we need to use the following formula:

number of units sold= (desired profit + fixed costs) / (selling price - unitary variable cost)

2,500= (100,000 + 27,500 + 15,000) / (125 - unitary variable cost)

312,500 - 2,500unitary variable cost = 142,500

170,000 = 2,500unitary variable cost

$68=unitary variable cost

whole quiz

1. the sum of all activities involved in getting high-quality products into the marketplace

2.operations

3. the principle of looking at the supply chain as a whole in order to improve the overall flow through the system.

4. produced; performed

5. activities producing tangible products, such as radios, newspapers, buses, and textbooks.

6. activities producing intangible and tangible products, such as entertainment, transportation, and education.

7.   customer focus

8. analyzing a competitor's products to identify desirable improvements

9. the systematic direction and control of the processes that transform resources into finished projects that create value for and provide benefits to consumers.

10. operation management.

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