Suppose you make beautiful coffee tables out of juniper trees. Your materials cost for each table is $135. You pay your craftsman $25 per hour and it takes him 5 hours to complete one table. If you sell these tables for $689, what is your Cost of Goods Sold Percentage?
- Suppose you make beautiful coffee tables out of juniper trees. Your materials cost for each table is $135. You pay your craftsman $25 per hour and it takes him 5 hours to complete one table. If you sell these tables for $689, what is your Cost of Goods Sold Percentage?
2. What is the Gross Profit Margin on the coffee tables described in question 1 above?
3. Suppose your company sells a 3 pack of lenses that attach to smart phones to improve the quality of pictures people take. You pay $29.95 for each 3 pack and sell them for $59.95. What is your Cost of Goods Sold Percentage for this item?
4. Suppose you sell 8,000 of the 3 pack of lenses described in question 3 above in one year. You cost on each 3 pack is $29.95 and you sell them for $59.95. If your operating expenses for the year total $144,080, what are your Net Income and Net Profit Margin Percentage?
5. Suppose an investor gave you $150,000 to start your business. You gave this investor 50 percent of your company for this investment. Your revenue year one was $479,600; your cost of goods sold was $239,600; and your total operating expenses were $144,080. What
6. Think of a potential product you might buy or create to sell in your store. Describe this product and estimate how many you think you can reasonably sell your first year in business.
7. Estimate the cost to make or buy the product you have described in the question above. What will you sell this product for? Based on your sales price, what do you estimate the Gross Profit Margin will be for this product?
8. Estimate your operating costs for the first year of your new business.
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