Jeremy Costa, owner of Costa Cabinets Inc., is preparing a bid on a job that requires $2,340 of direct materials, $2,223 of direct labor, and $1,638 of overhead. Jeremy normally applies a standard markup based on cost of goods sold to arrive at an initial bid price. He then adjusts the price as necessary in light of other factors (e.g., competitive pressure). Last years income statement is as follows:

Sales $123,500

Cost of goods sold 51,870

Gross margin $71,630

Selling and administrative expenses 46,300

Operating income $25,330

Required:

1. Calculate the markup that Jeremy will use. Round your answer to one decimal place.

%

2. What is Jeremy's initial bid price? Round your answer to the nearest dollar.

$