Question

If the unit selling price is $2.50 and the unit cost is $1.00, what action is needed to maintain the gross margin percentage when unit cost increases $0.25?

Answer 1

$2.50 / $1.00 = 2.5.
If the cost increases to $1.25, then the selling price should increase to $1.25 x 2.5 = $3.125 before rounding.