Question

TVLand sells home entertainment systems and also offers a complementary installation service. TVLand estimates that it incurs $40 in labor and materials to complete one installation, with an average of 25% profit based on cost. Using the expected cost plus margin approach, the stand-alone selling price of the installation service is:

Answer 1

The stand-alone selling of the installation service is 50 dollars

Step-by-step explanation:

cost mark-up formula:

from the cost of the service we charge a percentage of this cost:

cost + %markup x cost = sales price

$40 + 25% of $40 = sales price

$40 + $10 = sales prie

sales price $50