The following costs relate to Southside Company: Variable manufacturing cost,$30;variable selling and administrative cost,$8;applied fixed manufacturing overhead,$15;and allocated fixed selling and administrative cost,$4.If Southside uses absorption manufacturing-cost pricing formulas,the company's markup percentage would be computed on the basis of:
A)$30.
B)$38.
C)$45.
D)$57.
E)some other amount.

Question

Quizplus · Accepted Answer

The markup percentage is computed on the basis of the total manufacturing cost, which is the sum of the variable manufacturing cost, the applied fixed manufacturing overhead, and the allocated fixed selling and administrative cost. Therefore, the markup percentage would be computed on the basis of $30 + $15 + $4 = $49.

The Following Costs Relate to Southside Company: Variable Manufacturing Cost,$30;variable