Question

The Pines Company, which manufactures office equipment, is ready to introduce a new line of portable copiers. The following copier data are available:

Variable manufacturing cost $ 180
Variable selling and administrative cost 90
Applied fixed manufacturing cost 60
Allocated fixed selling and administrative cost 75
What price will the company charge if the firm uses cost-plus pricing based on total manufacturing cost and a markup percentage of 160%?

Answer 1

$ 624

Step-by-step explanation:

Given :

Variable manufacturing cost = $ 180

Applied fixed manufacturing cost = $ 60

Therefore, total manufacturing cost = 180 + 60

= $ 240

Mark up percentage = 160%

Price to be charged = 240 + 160% of 240

= 240 + 384

= $ 624