B. Consider the following:Total variable costs$200,000Total fixed costs$150,000Annual volume of units500Average invested capital$400,000Target Return on investment20.0%To the nearest tenth, what is the markup percentage required to earn the target return oninvestments using the cost-plus formula based on total costs?

TARGET COSTINGTarget Costing initiates cost management at the earliest stages of Product development…

Answered: B. Consider the following: Total…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 19EB: Wallace Company is considering two projects. Their required rate of return is 10%. Which of the two...

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Problem 4 (Target Costing, Strategy) Benchmark Industries manufactures large workbenches for industrial use. Wally Garcia, the vice president for marketing at Benchmark, has concluded from his market analysis that sales are dwindling for Benchmark's standard table because of aggressive pricing by competitors. Benchmark's table sells for P875 whereas the competition's comparable table is selling in the P80Q range. Garcia has determined that dropping price to P800 is necessary to regain the firm's annual market share of 10,000 tables. Cost data based on sales of 10,000 tables are: Budgeted Amount 400,000 sq. ft. 85,000 hrs. 30,000 hrs 320,000 hrs. Actual Amount Actual Cost 425,000 sq. ft. 100,000 hrs. 30,000 hrs. 320,000 hrs. Direct materials P2,700,000 1,000,000 300,000 4,000,000 Direct labor Machine setups Mechanical assembly
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Variable cost 25 BDT, Fixed cost 500000 BDT, Unit sales 100000, Investment 2000000, Expected return on investment 20%. Calculate the price?
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Q3. If sales are $500,000, variable cost are $200,000, and fixed costs are $240,000, what is the contribution margin ratio? Answer: ______________________________________________________________________ Explain your answer: ______________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
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Using the following data, estimate the new Return on Investment if there is a 10% decrease in variable and fixed costs - with average operating assets as the base. Sales $2,000,000 Variable costs 1.100.000 Contribution margin 900.000 Controllable fıxed costs 300.000 IControllable margin $600,000 Average operating assets $5,000,000 Round to two decimal places. Be sure to enter the answer as a percentage but do not include the % sign.
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