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nlexa [21]
3 years ago
7

Beta Company expects to incur overhead costs of $20,000 per month and direct production costs of $125 per unit. The estimated pr

oduction activity for the upcoming year is 1,000 units. If the company desires to earn a gross profit of $50 per unit, the sales price per unit would be which of the following amounts
A) $379
B) $187
C) $136
D) $195
Business
1 answer:
mina [271]3 years ago
4 0

Answer:

$415

Explanation:

For computing the sales per unit first we have to determine the total sales value which is shown below:

Direct Production costs (1,000 units × $125)   $125,000

Fixed Overhead costs for the year = $20,000 × 12 months = $240,000

Total Costs for the year              $365,000

Gross Profit desired (1,000 units × $50)   $50,000

Total Sales Value desired = Costs + Profit $415,000

Now

Sales price per unit is

= $415,000 ÷ 1,000 units

= $415

This is the answer but the same is not provided

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There will be a difference in the income .

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Increase in units 8000                                                              

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