Cost-Based Pricing and Markups with Variable Costs Compu Services provides computerized inventory consulting. The office and computer expenses are $600,000 annually and are not assigned to specific jobs. The consulting hours available for the year total 20,000, and the average consulting hour has $30 of variable costs. (a) If the company desires a profit of $160,000, what should it charge per hour? $Answer (b) What is the markup on variable costs if the desired profit is $240,000? Answer % (c) If the desired profit is $60,000, what is the markup on variable costs to cover (1) unassigned costs and (2) desired profit? Markup to cover unassigned costs Answer % Markup to cover desired profits Answer %
Cost-Based Pricing and Markups with Variable Costs Compu Services provides computerized inventory consulting. The office and computer expenses are $600,000 annually and are not assigned to specific jobs. The consulting hours available for the year total 20,000, and the average consulting hour has $30 of variable costs. (a) If the company desires a profit of $160,000, what should it charge per hour? $Answer (b) What is the markup on variable costs if the desired profit is $240,000? Answer % (c) If the desired profit is $60,000, what is the markup on variable costs to cover (1) unassigned costs and (2) desired profit? Markup to cover unassigned costs Answer % Markup to cover desired profits Answer %
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter3: Cost Behavior And Cost Forecasting
Section: Chapter Questions
Problem 31BEB: Inventory Valuation under Variable Costing Refer to the data for Pelham Company on the previous...
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Cost-Based Pricing
and Markups with Variable Costs
Compu Services provides computerized inventory consulting. The office and computer expenses are $600,000 annually and are not assigned to specific jobs. The consulting hours available for the year total 20,000, and the average consulting hour has $30 of variable costs.
(a) If the company desires a profit of $160,000, what should it charge per hour?
$Answer
(b) What is the markup on variable costs if the desired profit is $240,000?
Answer %
(c) If the desired profit is $60,000, what is the markup on variable costs to cover (1) unassigned costs and (2) desired profit?
Markup to cover unassigned costs Answer %
Markup to cover desired profits Answer %
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VIEWStep 4 b) Statement showing markup on variable cost when desires a profit of $240,000
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VIEWStep 6 c) Computation of markup on variable cost on Unassigned costs and desired profit
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