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  • AKMEN

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    Jack Liu
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    The document contains 3 calculations related to profit margins: 1) A company's gross profit margin is 59,920/214,000 = 28% 2) Direct materials cost $230, direct labor $50, overhead $20 for a total cost of $300. With a 28% markup the price is $300 + $84 = $384. 3) A company's total costs are $145,000 for direct materials, $45,000 for direct labor, $19,400 for overhead, and $40,520 for expenses. The bid price is calculated as direct materials + 121% markup of direct materials = $230 + $190 = $420.

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    Connerstone exercise

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    The document contains 3 calculations related to profit margins: 1) A company's gross profit margin is 59,920/214,000 = 28% 2) Direct materials cost $230, direct labor $50, overhead $20 for a total cost of $300. With a 28% markup the price is $300 + $84 = $384. 3) A company's total costs are $145,000 for direct materials, $45,000 for direct labor, $19,400 for overhead, and $40,520 for expenses. The bid price is calculated as direct materials + 121% markup of direct materials = $230 + $190 = $420.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    10 views2 pages

    AKMEN

    Uploaded by

    Jack Liu
    The document contains 3 calculations related to profit margins: 1) A company's gross profit margin is 59,920/214,000 = 28% 2) Direct materials cost $230, direct labor $50, overhead $20 for a total cost of $300. With a 28% markup the price is $300 + $84 = $384. 3) A company's total costs are $145,000 for direct materials, $45,000 for direct labor, $19,400 for overhead, and $40,520 for expenses. The bid price is calculated as direct materials + 121% markup of direct materials = $230 + $190 = $420.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 2

    1.

    Markup on COGS Gross Profit 59,920


    = X 100% = x 100%
    COGS 214,000

    2. DM $ 230
    DL $ 50
    OH $ 20
    $ 300 + 28% $ 384

    3. Makrup on DM DL +OH + Selling and Administrative Expese + Operating Income


    =
    DM
    45000+45000+19400+40520
    =
    124000
    149920
    = = 1,21 x 100% = 121%
    124000

    Bid Price = $230+(230*121%)


    = $230+190 = $ 420
    = 28%

    erating Income

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