(Appendix 12A)Cost Data Relating to the Single Product Produced by the Jones

question 58

Multiple Choice

(Appendix 12A) Cost data relating to the single product produced by the Jones Company are given below: $\begin{array}{lccc}& \underline { \text { Per Unit } } & \underline { \text { Total per year} } \\\text { Direct materials } & \$ 10 & \\\text { Direct labour } & 6& \\\text { Variable manufacturing overhead } & 3 & \\\text { Fixed manufacturing overhead. } & & \$ 140,000 \\\text { Variable selling, general, and } & & \\\text { administrative expense } & 1 & \\\text { Fixed selling, general, and } & & \\\text { administrative expense } & - & \$ 180,000\end{array}$
The Jones Company uses the absorption costing approach with a desired markup of 60%.If the company plans to produce and sell 20,000 units each year,what would be the target selling price per unit?

• A) $32.00.
• B) $36.00.
• C) $41.60.
• D) $43.20.

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Definitions:

Hybrid Security

A hybrid security is a financial instrument combining elements of both debt and equity, offering benefits and risks of both types.

Common Stock

Represents ownership shares in a corporation, giving holders voting rights and a share in the company's profits via dividends.

Dividend Per Share

The total dividends declared by a company for each outstanding share of common stock.

Expected Return

The weighted average of all possible returns for a given investment, factoring in the probabilities of each outcome, used as a tool for evaluating investments.