12 Dec Ramanan, Inc., has performed cost studies and proj
Ramanan, Inc., has performed cost studies and projected the following annual costs based on 200,000 units of production and sales:Total Annual Costs (200,000 units)Direct Material $ 400,000Direct Labor . 360,000Manufacturing Overhead .. 300,000Selling, General, and Administrative .. 200,000Total $1,260,000a. Compute Ramanan’s unit selling price that will yield a profit of $300,000, given sales of 200,000 units.b. Assume management selects a selling price of $8 per unit. Compute Ramanan’s dollar sales that will yield a projected 20 percent profit on sales, assuming variable costs per unit are 60 percent of the selling price per unit and fixed costs are $420,000.
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