Joeston Corporation Makes a Product with the Following Costs

Multiple Choice

Joeston 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 14, 000 units per year.The company has invested $540, 000 in this product and expects a return on investment of 10%.The markup on absorption cost would be closest to:

A) 27.1%
B) 124.2%
C) 34.2%
D) 10.0%