Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Many luxury sheets cost less than $200 to make but sell for more than $500 in retail stores. Some cost even more - consumers pay

image text in transcribed

Many luxury sheets cost less than $200 to make but sell for more than $500 in retail stores. Some cost even more - consumers pay almost $3,000 for Frett'e "Tangeri Pizzo" king-size luxury linens. The creators of a new brand of luxury linens, called Boll \& Branch, have entered this market and are determining the price at which to sell their sheets directly to consumers online. They want to price their sheets lower thar most brands but still want to earn an adequate margin on sales. The sheets come in a luxurious box that can be reused to store lingerie, jewelry, or other keepsakes. The Boll \& Branch brand touts fair trade practices when sourcing its high-grade long-staple organic cotton from India. Given the cost per king-size sheet set below, and assuming the manufacturer has total fixed costs of $200,000 and estimates first year sales will be 20,000 sets, determine the price to consumers if the company desires a 45 percent margin on sales. Click the icon to view the cost information for a king-size set. The variable cost is $. (Round to the nearest dollar.) The cost per unit is $. (Round to the nearest dollar.)

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

Step: 3

blur-text-image

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

Managerial Accounting Ba 213 At Central Oregon Community College

Authors: Albrecht

1st Edition

1111523622, 978-1111523626

More Books

Students also viewed these Accounting questions

Question

=+2. What is the background of the situation?

Answered: 1 week ago