Each praline should be sold for $1.95.
Here's how you can calculate it:
- The cost to make each praline is $1.06.
- The markup based on selling price is 35%, which means the selling price is 135% of the cost.
- Let x be the selling price per praline.
- We can use the formula: Selling price = Cost / (1 - Markup) to find the selling price.
- Substituting the values, we get: x = 1.06 / (1 - 0.35) = 1.63.
- However, we need to take into account the anticipated 20% spoilage, which means we need to sell more pralines to make up for the ones that are spoiled.
- The total number of pralines needed is: 45 / (1 - 0.20) = 56.25, which we can round up to 57.
- Therefore, the selling price per praline should be: $1.63 * 1.35 = $2.20.
- Rounding this to the nearest cent, we get: $2.20 rounded to the nearest cent is $2.19, which is not correct since it is less than the cost of making each praline.
- We need to adjust the selling price to ensure that we make a profit. We can increase the selling price by $0.01 until we reach a price that is greater than the cost of making each praline.
- Increasing the selling price by $0.01, we get: $2.21, which is still less than the cost of making each praline.
- Increasing the selling price by $0.01 again, we get: $2.22, which is greater than the cost of making each praline.
- Therefore, each praline should be sold for $2.22 rounded to the nearest cent, which is $2.21.