Qualls Corporation Makes a Product That Has the Following Costs

question 71

Essay

Qualls Corporation makes a product that has the following costs:
The company uses the absorption costing approach to cost-plus pricing as described in the text.The pricing calculations are based on budgeted production and sales of 48,000 units per year.
The company has invested $360,000 in this product and expects a return on investment of 15%.
Required:
a.Compute the markup on absorption cost.
b.Compute the selling price of the product using the absorption costing approach.
c.Assume that every 10% increase in price leads to a 13% decrease in quantity sold.Assuming no change in cost structure and that direct labor is a variable cost,compute the profit-maximizing price.

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Definitions:

Onboarding

Ongoing process that aims to prepare new employees for full participation in the organization.

Apprenticeship

An approach to educate up-and-coming professionals in a certain field by providing them with hands-on training on the job, along with additional academic learning.

Instructional Design

The practice of creating educational and training materials in a systematic and efficient manner to support the learning process.

E-Learning

Receiving training via the Internet or the organization's intranet.