The variable cost is $ (Round to the nearest dollar).

Essentials of Business Analytics (MindTap Course List)
2nd Edition
ISBN:9781305627734
Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson
Publisher:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson
Chapter13: Nonlinear Optimization Models
Section: Chapter Questions
Problem 5P: Jims Camera shop sells two high-end cameras, the Sky Eagle and Horizon. The demand for these two...
Question
Many luxury sheets cost less than $200 to make but sell for more than $500 in retail stores. Some cost even more
consumers pay almost $3,000 for Frett'e "Tangeri Pizzo" king-size luxury linens. The creators of a new brand of
luxury linens, called Boll & Branch, have entered this market and are determining the price at which to sell their
sheets directly to consumers online. They want to price their sheets lower than most brands but still want to earn an
adequate margin on sales. The sheets come in a luxurious box that can be reused to store lingerie, jewelry, or other
keepsakes. The Boll & Branch brand touts fair trade practices when sourcing its high-grade long-staple organic cotton
from India. Given the cost per king-size sheet set below, and assuming the manufacturer has total fixed costs of
$380,000 and estimates first year sales will be 20,000 sets, determine the price to consumers if the company desires
a 60 percent margin on sales.
Click the icon to view the cost information for a king-size set
The variable cost is $
(Round to the nearest dollar.)
Transcribed Image Text:Many luxury sheets cost less than $200 to make but sell for more than $500 in retail stores. Some cost even more consumers pay almost $3,000 for Frett'e "Tangeri Pizzo" king-size luxury linens. The creators of a new brand of luxury linens, called Boll & Branch, have entered this market and are determining the price at which to sell their sheets directly to consumers online. They want to price their sheets lower than most brands but still want to earn an adequate margin on sales. The sheets come in a luxurious box that can be reused to store lingerie, jewelry, or other keepsakes. The Boll & Branch brand touts fair trade practices when sourcing its high-grade long-staple organic cotton from India. Given the cost per king-size sheet set below, and assuming the manufacturer has total fixed costs of $380,000 and estimates first year sales will be 20,000 sets, determine the price to consumers if the company desires a 60 percent margin on sales. Click the icon to view the cost information for a king-size set The variable cost is $ (Round to the nearest dollar.)
Expert Solution
steps

Step by step

Solved in 4 steps with 2 images

Blurred answer
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Essentials of Business Analytics (MindTap Course …
Essentials of Business Analytics (MindTap Course …
Statistics
ISBN:
9781305627734
Author:
Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson
Publisher:
Cengage Learning
Principles of Accounting Volume 2
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College