Light Force Inc. produces and sells lighting fixtures. An entry light has a total cost of $180 per unit, of which $100 is product cost and $80 is selling and administrative expenses. In addition, the total cost of $180 is made up of $110 variable cost and $70 fixed cost. The desired profit is $45 per unit.

1. Determine the markup percentage on product cost. Round the answer to nearest whole number.

Question

Greyson Phillips

Business

26 May, 00:22

Light Force Inc. produces and sells lighting fixtures. An entry light has a total cost of $180 per unit, of which $100 is product cost and $80 is selling and administrative expenses. In addition, the total cost of $180 is made up of $110 variable cost and $70 fixed cost. The desired profit is $45 per unit.

1. Determine the markup percentage on product cost. Round the answer to nearest whole number.

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Answers (1)

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Fiona · Answer 1

Total mark up = 45%

Explanation:

Giving the following information:

An entry light has a total cost of $180 per unit, of which $100 is product cost and $80 is selling and administrative expenses. Also, the total cost of $180 is made up of $110 variable cost and $70 fixed cost. The desired profit is $45 per unit.

If $100 is the product cost, and $45 is the desired mark up:

100=100%

45=? = (45/100) = 0.45 = 45%