TB MC Qu. 23-116 (Algo) Pauley Company needs to determine...

Pauley Company needs to determine a markup for a new product. Pauley expects to sell 15,000 units and wants a target profit of $56 per unit. Additional information is as follows:

Variable Costs per Unit		Fixed Costs (total)
Direct materials	$ 25	Overhead	$ 46,900
Direct labor	26	General and administrative	53,900
Overhead	19
General and administrative	28

Using the variable cost method, what markup percentage to variable cost should be used?

Multiple Choice

• 54%

• 59%

• 75%

• 64%

• 63%