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Hordel Company needs to determine a markup for a new product. Hordel expects to sell 5,000 units and wants a target profit of $94 per
Hordel Company needs to determine a markup for a new product. Hordel expects to sell 5,000 units and wants a target profit of $94 per unit. Additional information is as follows:
Variable Costs per Unit | Fixed Costs (total) | ||
---|---|---|---|
Direct materials | $ 25 | Overhead | $ 51,360 |
Direct labor | 46 | General and administrative | 40,360 |
Overhead | 26 | ||
General and administrative | 27 |
Using the variable cost method, what markup percentage to variable cost should be used?
Multiple Choice
74.1%
92.2%
88.1%
85.7%
90.6%
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