In which of the following pricing methods is the markup added to manufacturing costs and selling and expenses to determine the selling price?
A) Total cost method
B) Product cost method
C) Variable cost method
D) Fixed cost method

Question

Quizplus · Accepted Answer

In the total cost method, the markup is added to the total cost which includes manufacturing costs as well as selling and expenses. This ensures that all the costs incurred in producing and selling the product are covered and a profit is also made. Therefore, A is the best choice. The other options (B, C, and D) do not consider all the costs incurred in producing and selling the product.

In Which of the Following Pricing Methods Is the Markup