Question
Kolam products ltd. produces a stabilizer that sells for rs.300. An increase of 15% in the cost of materials and 10% in the cost of
Kolam products ltd. produces a stabilizer that sells for rs.300. An increase of 15% in the cost of materials and 10% in the cost of labour is anticipated. If the only figures available are those given below, what must be the selling price to give the same percentage of gross profit as before?
Material costs have been 45% of cost of sales
Labour costs have been 40% of cost of sales
Overhead costs have been 15% of the sales
The anticipated increased costs in relation to the present sale
Price would cause a 35% decrease in the amount of present gross Profit
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