Accounting 26th Edition by Carl Warren ,Jim Reeve ,Jonathan Duchac

Exercise 66

A Product cost markup percentage
Magna Lighting Inc. produces and sells lighting fixtures. An entry light has a total cost of $125 per unit, of which $80 is product cost and $45 is selling and administrative expenses. In addition, the total cost of $125 is made up of $90 variable cost and $35 fixed cost. The desired profit is $55 per unit. Determine the markup percentage on product cost.
B Product cost markup percentage
Green Thumb Garden Tools Inc. produces and sells home and garden tools and equipment. A lawnmower has a total cost of $230 per unit, of which $160 is product cost and $70 is selling and administrative expenses. In addition, the total cost of $230 is made up of $120 variable cost and $110 fixed cost. The desired profit is $58 per unit. Determine the markup percentage on product cost.