. Multiple Products Co.
Multiple Products Co. has predicted the following costs for this year for 100,000 units:
-Refer to Multiple Products Co. What is the markup on manufacturing costs needed to break even?
A) 100 percent
B) 40 percent
C) 140 percent
D) 280 percent

Question

Quizplus · Accepted Answer

To break even, the total cost per unit would be $13.20 ($7.50 + $2.40 + $1.80 + $1.50). To find the markup on manufacturing costs, we need to divide the manufacturing costs by the total manufacturing cost per unit ($8.70/$13.20) and multiply by 100. This gives us a markup of approximately 65.9 percent. Since the closest option is B (40 percent), that is the best choice.