Use This Information for Magpie Corporation to Answer the Questions

question 102

Multiple Choice

Use this information for Magpie Corporation to answer the questions that follow.
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Magpie Corporation uses the total cost concept of product pricing. Below is the cost information for the production and sale of 60,000 units of its sole product. Magpie desires a profit equal to a 25% rate of return on invested assets of $700,000.
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$$\begin{array} { l r } \text { Fixed factory overhead cost } & \$ 38,700 \\\text { Fixed selling and administrative costs } & 7,500 \\\text { Variable direct materials cost per unit } & 4.60 \\\text { Variable direct labor cost per unit } & 1.88 \\\text { Variable factory overhead cost per unit } & 1.13 \\\text { Variable selling and administrative cost per unit } & 4.50\end{array}$$
-The dollar amount of the desired profit from the production and sale of the company's product is

• A) $175,000
• B) $67,200
• C) $73,500
• D) $96,000

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Definitions:

Caffeine

A central nervous system stimulant commonly found in coffee, tea, chocolate, and certain medications, known for its ability to prevent drowsiness.

Warming Up

Perform physical activities gradually to prepare the body for more strenuous exercise, reducing the risk of injury.

Stretches

Exercises aimed at improving the flexibility and elasticity of muscles through various extension movements.

Injuries

Harm or damage that is done or sustained by a person, typically requiring medical intervention.