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Product Pricing: Single Product Sue Bee Honey is one of the largest processors of its product for the retail market. Assume that one of its plants has annual fixed costs totaling $16,317,500, of which $5,250,500 is for administrative and selling efforts. Sales are anticipated to be 950,000 cases a year. Variable costs for processing are $35 per case, and variable selling expenses are 10% of selling price. There are no variable administrative expenses. Required If the company desires a pretax profit of $9,000,000, what is the selling price per case?

Product Pricing: Single Product Sue Bee Honey is one of the largest processors of its product for the retail market. Assume that one of its plants has annual fixed costs totaling $16,317,500, of which $5,250,500 is for administrative and selling efforts. Sales are anticipated to be 950,000 cases a year. Variable costs for processing are $35 per case, and variable selling expenses are 10% of selling price. There are no variable administrative expenses. Required If the company desires a pretax profit of $9,000,000, what is the selling price per case?

Understanding Business
Understanding Business
12th Edition
ISBN:9781259929434
Author:William Nickels
Publisher:William Nickels
Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment
Section: Chapter Questions
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Product Pricing: Single Product Sue Bee Honey is one of the largest processors of its product for the retail market. Assume that one of its plants has annual fixed costs totaling $16,317,500, of which $5,250,500 is for administrative and selling efforts. Sales are anticipated to be 950,000 cases a year. Variable costs for processing are $35 per case, and variable selling expenses are 10% of selling price. There are no variable administrative expenses. Required If the company desires a pretax profit of $9,000,000, what is the selling price per case?
Transcribed Image Text:Product Pricing: Single Product Sue Bee Honey is one of the largest processors of its product for the retail market. Assume that one of its plants has annual fixed costs totaling $16,317,500, of which $5,250,500 is for administrative and selling efforts. Sales are anticipated to be 950,000 cases a year. Variable costs for processing are $35 per case, and variable selling expenses are 10% of selling price. There are no variable administrative expenses. Required If the company desires a pretax profit of $9,000,000, what is the selling price per case?
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