Joeston Corporation Makes a Product with the Following Costs

question 25

Multiple Choice

Joeston Corporation makes a product with the following costs: The company uses the absorption costing approach to cost-plus pricing described in the text.The pricing calculations are based on budgeted production and sales of 14, 000 units per year.The company has invested $540, 000 in this product and expects a return on investment of 10%.The markup on absorption cost would be closest to:

• A)27.1%
• B)124.2%
• C)34.2%
• D)10.0%