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Last year, Bagger Company had sales revenue of $1,250,000, direct materials of $280,000, directlabor of $310,700, overhead of $449,300 (30% is variable). Bagger calculates sales price using a markup on cost of goods sold. Required1. Calculate the markup Bagger will use.2. If a job has manufacturing cost of $43,000, what is Bagger’s price?

Last year, Bagger Company had sales revenue of $1,250,000, direct materials of $280,000, directlabor of $310,700, overhead of $449,300 (30% is variable). Bagger calculates sales price using a markup on cost of goods sold. Required1. Calculate the markup Bagger will use.2. If a job has manufacturing cost of $43,000, what is Bagger’s price?

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter3: Cost Behavior
Section: Chapter Questions
Problem 10E: SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that...
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Last year, Bagger Company had sales revenue of $1,250,000,

direct materials of $280,000,

directlabor of $310,700,

overhead of $449,300 (30% is variable).

Bagger calculates sales price using a markup on cost of goods sold.

Required
1. Calculate the markup Bagger will use.
2. If a job has manufacturing cost of $43,000, what is Bagger’s price?

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