The Toowoomba Produce Suppliers packages and distributes three grades of animal feed. The material cost per tonne and estimated annual sales for each of the products are:
|Product||Material cost||Estimated sales|
|Super Premium||$16||1000 tonnes|
The indirect cost of operating the machinery used to package all three products is $20 000 per year. In the past, prices have been set by allocating the indirect costs to products on the basis of estimated sales in tonnes. The resulting total costs (material costs plus allocated fixed overhead) are then marked up by 100 per cent.
- Allocate total indirect cost to each product.
- Determine the total cost for each product.
- Calculate the selling price per unit for each product, using the method described for setting prices.
Click on Buy Solution and make payment. All prices shown above are in USD. Payment supported in all currencies. Price shown above includes the solution of all questions mentioned on this page. Please note that our prices are fixed (do not bargain).
After making payment, solution is available instantly.Solution is available either in Word or Excel format unless otherwise specified.
If your question is slightly different from the above question, please contact us at firstname.lastname@example.org with your version of question.