FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Transcribed Image Text:You are the sales manager for Mighty Widgets Manufacturers Inc. You are negotiating a 25% markup based on manufacturer selling
price to Widget Wholesalers, a promising new prospect. However, Widget Wholesalers are used to % markup based on retail purchase
price. You want to help them understand what you are offering and decide to express it in terms that the Widget Wholesalers can readily
understand and relate to. Pick the correct equivalent of the 25%:
O 31.25%
O 33.33%
O 20%
O 18.75%
O 26 25%
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- Question 2. The marketing manager for Tim Hortons is attempting to price a cup of coffee. She knows that the cost of the coffee is $0.14 per cup, and expenses are 30% of the regular selling price. She would like the coffee to achieve an 88.24% markup on selling price.a) What is the regular selling price for a cup of coffee?b) What is the profit per cup?c) What is the markup on cost percentage?arrow_forwardHello tutor please provide Solutionsarrow_forwardQ.1 ChemCo has developed a new product, and has consulted with its marketing department, who have determined that the market share will be 20,000 units, and have recommended that a selling price of $60.00 per unit would be app- ropriate. ChemCo has been able to keep the cost per unit at $50.00. The company has spent a total of $900,000 to design and develop this product. Required: Use the above information to compute as follows: 1. Compute the expected margin for ChemCo 2. Compute the expected turnover 3. Compute the ROI Explain why it is necessary to do the above computations, and show how management can use this information for managing operationsarrow_forward
- 3. You are selling necklaces on Amazon for $23.99 and your gross margin is 53%. Amazon will let you buy a "sponsored listing" which means your listing will be shown at the top of the Amazon search results. The average CPC is $0.37 per click. Of those people who click on your listing, 7% purchase the necklace. a. What is the ROI for this type of advertising? Assume all sales from users who click on your ad are incremental.arrow_forwardBear Paints is a national paint manufacturer and retailer. (Click the icon to view additional information.) Assume that management has specified a 20% target rate of return. Read the requirements. Requirement 1. Calculate each division's ROI. First enter the formula, then calculate the ROI for each division. (Enter the ROI as a percent rounded to the nearest hundredth of a percentage, X.XX%.) Paint Stores Paint Stores Consumer Requirement 2. Calculate each division's sales margin. Interpret your results. Enter the formula, then calculate the sales margin for each division. (Enter the sales margin as a percent rounded to the nearest hundredth of a percentage, X.XX%.) Sales margin Consumer Interpret your results. The Paint Stores Consumer + The Paint Stores + Consumer + Division is more profitable on each dollar of sales. Requirement 3. Calculate each division's capital turnover. Interpret your results. First enter the formula, then calculate the capital turnover for each division.…arrow_forwardQuick Inc. has sales of $36,400,000, and the break-even point in sales dollars is $24,024,000. Determine the company’s margin of safety as a percent of current sales. Enter your answer as a whole number.fill in the blank 1 %arrow_forward
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