Bowring Company took the following data from their income statement at the end of the current year.
$$\begin{array} { l r }
\text { Per-unit product cost: } & \$ 30 \
\text { Gross margin percentage: } & 40 \% \
\text { Selling and admini strative expenses } & \$ 30,000 \
\text { Operating income } & \$ 10,000
\end{array}$$
-Refer to the Figure.What was the sales price per unit?
A)$10
B)$20
C)$30
D)$50

Question

Bowring Company took the following data from their income statement at the end of the current year.
 $$\begin{array} { l r } 
\text { Per-unit product cost: } & \$ 30 \
\text { Gross margin percentage: } & 40 \% \
\text { Selling and admini strative expenses } & \$ 30,000 \
\text { Operating income } & \$ 10,000
\end{array}$$
-Refer to the Figure.What was the sales price per unit?
A)$10
B)$20
C)$30
D)$50

Quizplus · Accepted Answer

The gross margin percentage is 40%, which means the cost of goods sold (COGS) is 60% of the sales price. Given the per-unit product cost is $30, which represents the 60% COGS, the sales price per unit can be calculated as $30 / 0.60 = $50.

Bowring Company Took the Following Data from Their Income Statement