Sutton Products Is a Price-Setter That Uses the Cost-Plus Pricing

question 186

Multiple Choice

Sutton Products is a price-setter that uses the cost-plus pricing approach.The products are specialty vacuum tubes used in sound equipment.The CEO is certain that the company can produce and sell 310,000 units per year,due to the high demand for the product.Variable costs are $2.40 per unit.Total fixed costs are $970,000 per year.The CEO will receive stock options if $100,000 of operating income for the year is reported.What sales price would allow the CEO to achieve the target if the cost-plus pricing method is used? (Round your answer to the nearest cent.)

• A) $2.40 per unit
• B) $5.85 per unit
• C) $3.45 per unit
• D) $5.21 per unit

Describe the role of the heater core in a vehicle's HVAC system.

Understand the importance of proper coolant mixture for freezing and boiling points.

Know the safety and environmental concerns related to refrigerants.

Recognize the various components inside a vehicle's HVAC system and their configurations.

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Definitions:

Total Materials Variance

The difference between the actual cost of materials used in production and the standard cost of those materials.

Overhead Controllable Variance

Overhead Controllable Variance refers to the difference between the actual indirect operational expenses incurred and the budgeted or expected overhead costs that could be influenced by management decisions.

Total Overhead Variance

The difference between the actual overhead incurred and the standard overhead assigned to production.

Overhead Variances

The difference between actual overhead costs and the standard (or expected) overhead costs for a period.