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  • Ex Chapter 4

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    Thái Thịnh 32.Phạm Thị
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    The document contains 3 examples of calculating markup percentage. The first uses a cost base per unit of $30 with an 18.4% markup to reach a target selling price of $35.52 per unit. The second uses a 50% markup on a cost base of $24 to reach a target price of $36 per unit. The third example calculates total costs and desired profit to back into a target cost per unit of $55 for 50,000 batteries.

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    The document contains 3 examples of calculating markup percentage. The first uses a cost base per unit of $30 with an 18.4% markup to reach a target selling price of $35.52 per unit. The second uses a 50% markup on a cost base of $24 to reach a target price of $36 per unit. The third example calculates total costs and desired profit to back into a target cost per unit of $55 for 50,000 batteries.

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    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    3 views3 pages

    Ex Chapter 4

    Uploaded by

    Thái Thịnh 32.Phạm Thị
    The document contains 3 examples of calculating markup percentage. The first uses a cost base per unit of $30 with an 18.4% markup to reach a target selling price of $35.52 per unit. The second uses a 50% markup on a cost base of $24 to reach a target price of $36 per unit. The third example calculates total costs and desired profit to back into a target cost per unit of $55 for 50,000 batteries.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 3

    1) Markup percentage =

    2)
    Cost base/unit
    + Direct materials
    + Direct labor
    + Variable manufactur
    Cost base/unit
    Markup/unit ( 30*18,4%
    Target selling price/unit

    3) Markup percentage =

    Cost base/unit
    + Direct materials
    + Direct labor
    + Variable manufactur
    + Variable SA&D
    Cost base/unit
    Markup/unit ( 24*50%)
    Target selling price/unit
    1) Markup percentage = (Fixed c𝑜𝑠𝑡𝑠+𝐷𝑒𝑠𝑖𝑟𝑒𝑑
    𝑝𝑟𝑜𝑓𝑖𝑡)/(𝑇𝑜𝑡𝑎𝑙 𝑣𝑎𝑟𝑖𝑎𝑏𝑙𝑒 𝑐𝑜𝑠𝑡𝑠)
    = (60,000+500,000∗18%)/
    (12,500∗30) *100%
    = 18,4%
    THE PRICE QUOTATION SHEET
    Cost base/unit
    + Direct materials
    + Direct labor
    + Variable manufacturing overhead
    Cost base/unit 30
    Markup/unit ( 30*18,4%) 5.52
    Target selling price/unit 35.52

    3) Markup percentage = (Fixed c𝑜𝑠𝑡𝑠+𝐷𝑒𝑠𝑖𝑟𝑒𝑑


    𝑝𝑟𝑜𝑓𝑖𝑡)/(𝑇𝑜𝑡𝑎𝑙 𝑣𝑎𝑟𝑖𝑎𝑏𝑙𝑒 𝑐𝑜𝑠𝑡𝑠)
    = (60,000+500,000∗18%)/
    (12,500∗(20+4)) *100%
    = 50%
    THE PRICE QUOTATION SHEET
    Cost base/unit
    + Direct materials
    + Direct labor
    + Variable manufacturing overhead
    + Variable SA&D
    Cost base/unit 24
    Markup/unit ( 24*50%) 12
    Target selling price/unit 36
    Sales = 65* 50,000 = 3,250,000
    Desired profit = 2,500,000 * 20% = 500,000
    → Total cost to produce 50,000 batteries = Sales - desired profit
    = 3,250,000 - 500,000
    = 2,750,000
    → Target cost of one battery = 2,750,000/
    50,000
    = 55

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