Minden Corporation estimates that the following costs and activity would be associated with the manufacture and sale of product A: Number of units sold annually 40,000 Required investment$800,000 Unit product cost$25 Selling and administrative expenses$600,000 ?If the company uses the absorption costing approach to cost-plus pricing described in the text and desires a 15% rate of return on investment (ROI), the required markup on absorption cost for Product A would be closest to:
A. 60%
B. 12%
C. 15%
D. 72%
Answer: D
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