Jaber Corporation Makes a Product with the Following Costs

Multiple Choice

Jaber Corporation makes a product with the following costs: The company uses the absorption costing approach to cost-plus pricing described in the text. The pricing calculations are based on budgeted production and sales of 52,000 units per year. The company has invested $200,000 in this product and expects a return on investment of 9%.
The markup on absorption cost would be closest to:

A) 37.7%
B) 9.0%
C) 110.8%
D) 37.1%