The Following Data Pertain to Wolter Incorporated What Price Will the Company Charge If the Firm Uses

question 55

Multiple Choice

The following data pertain to Wolter Incorporated: $\begin{array} { l r } \text { Variable manufacturing cost } & \$ 70 \\\text { Variable selling and administrative cost } & 20 \\\text { Applied fixed manufacturing cost } & 20 \\\text { Allocated fixed selling and administrative cost } & 4\end{array}$ What price will the company charge if the firm uses cost-plus pricing based on total cost and a markup percentage of 50%?

• A)$114.
• B)$126.
• C)$136.
• D)$159.
• E)$171.

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Definitions:

Straight Line Amortization

A method of writing off the cost of an intangible asset evenly over its useful life.

Equity Method

An accounting approach used to assess the investment in another company, where the investment is initially recorded at cost and subsequently adjusted to reflect the investor's share of net assets and recorded earnings of the investee.

Impairment Test

An examination to determine if an asset's carrying amount exceeds its recoverable amount, and if so, to measure the amount of impairment loss.

Book Value

A financial measurement that calculates the value of a firm's equity as it appears on the balance sheet by subtracting liabilities from assets.