Linwood Company recently began production of a new navigation device, which required a capital investment of $660,000. Linwood is currently considering establishing a selling price for this new device that will ensure a 25% return on the capital investment. The engineering and the sales department compiled the following estimates for producing and selling 77.000 devices Per Unit Total (77,000 units)
Direct Materials $12
Direct Labor $26
Variable Manufacturing Overhead 514
Selling and Administrative Expenses $17
Fixed Manufacturing Overhead $223.000
General and Administrative Expenses $73,000 1080-
A. Using the cost plus pricing method, calculate the markup percentage.