Question

Oriole Company has a new product going on the market next year. The following data are projections for production and sales: Variable costs $430000 Fixed costs $450000 ROI 16% Investment $2200000 Sales 200000 units What is the markup percentage

Answer 1

The markup percentage is 40%

Step-by-step explanation:

The computation of the markup percentage is shown below:

Markup percentage is

= Return on investment ÷ Total cost

= ($2,200,000 × 16%) ÷ ($430,000 + $450,000)

= $352,000 ÷ $880,000

= 40%

Hence, the markup percentage is 40%

We simply applied the above formula

And, the same is to be considered

Sales would be ignored in this case