Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A . Selling Cookies using Cost - Based Pricing You have decided that you want to put your entrepreneurial spirit to use and are going

A. Selling Cookies using Cost-Based Pricing
You have decided that you want to put your entrepreneurial spirit to use and are going to start a
business at Foothill selling chocolate chip cookies. You know that students at Foothill love chocolate
chip cookies, and you love baking them! You decide to apply the cost-based pricing method in order to
determine the price of your product.
Here are some basic facts:
You want to sell 6 cookies in beautiful recycled paper boxes wrapped in a colorful bow.
Ingredients for the cookies -- including their purchase price -- are listed as follows:
1 box of cookie mix costs $6 and is enough for 4 dozen cookies
1 bag of chocolate chips costs $4.50 and is enough for 4 dozen cookies
1 small bottle of cinnamon (your secret ingredient) costs $10 and is enough for 12 dozen cookies
1 carton of a dozen eggs costs $3.2 eggs are needed per box of cookie mix
You can buy a pack of paper boxes that fit 6 cookies at the cost of 20 boxes for $4
Question 1:
(A) What is the cost for the amount of egg used in one cookie
(B) What is the unit cost of one cookie?
(C) What is the unit cost of one paper box?
(D) Ignoring all other costs, what price should you charge if you want to make a 30% markup on each
box of 6 cookies?
image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Beetons Book Of Household Management

Authors: Arlene Morriso

1st Edition

1721995153, 978-1721995158

More Books

Students also viewed these General Management questions