Magney, Inc

Multiple Choice

Magney, Inc., uses the absorption costing approach to cost-plus pricing described in the text to set prices for its products. Based on budgeted sales of 42,000 units next year, the unit product cost of a particular product is $61.90. The company's selling and administrative expenses for this product are budgeted to be $818,800 in total for the year. The company has invested $480,000 in this product and expects a return on investment of 10%.The selling price for this product based on the absorption costing approach would be closest to: (Do not round intermediate calculations.)

A) $82.54
B) $120.37
C) $68.09
D) $81.40