FAST Company Has Obtained the Following Data Concerning a New

question 85

Multiple Choice

FAST Company has obtained the following data concerning a new product: Production Costs,Using traditional costing method……..………......$3.00
Production Costs,Using activity-based costing method…………......$5.00
Nonproduction Costs,Using activity-based costing method…….....$2.50
FAST Company wants the price of the new product to cover all costs plus a 100% markup.The production process used for the low volume product is very complicated and it has a higher proportion of indirect costs than direct costs.
What price per unit should FAST Company charge for the new product?

• A)$6.00
• B)$10.00
• C)$11.00
• D)$15.00

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Definitions:

Purchasing Generators

Refers to the process of acquiring generators, which are machines that convert mechanical energy into electrical energy, for use in various applications.

Contingency Plan

A prepared strategy or procedure designed to address possible future events or circumstances that may disrupt normal operations or require a swift response.

Monitoring

The process of systematically tracking performance or quality over time with the aim of making improvements.

Clarify Tasks

The process of making responsibilities, expectations, and tasks clear and understandable to ensure they are completed effectively.