1. Ricardo Company has predicted the following costs for this year for 50,000 units:

	Manufacturing	Selling and Administrative
Variable	$200,000	$ 25,000
Fixed	300,000	75,000
Total	$500,000	$100,000

What is the manufacturing cost markup needed to obtain a target profit of $100,000?

Select one:

A. 33.5 percent

B. 40.0 percent

C. 34.5 percent

D. 10.4 percent

2. JD Company has two service departments whose direct department costs are $15,000 and $25,000, respectively, and two producing departments whose direct department costs are $210,000 and $200,000, respectively. The combined total department costs for the producing departments after allocating the service departments are:

Select one:

A. $450,000

B. $400,000

C. $460,000

D. $415,000

3. Zach Company has predicted the following costs for this year for 100,000 units:

	Manufacturing	Selling and Administrative
Variable	$100,000	$ 25,000
Fixed	300,000	150,000
Total	$400,000	$175,000

What is the markup on variable costs needed to achieve a target profit of $35,000?

Select one:

A. 440 percent

B. 388 percent

C. 430 percent

D. 200 percent