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Sliva [168]
3 years ago
11

Gibson instruments is planning to produce and market a new line of guitars. the current market price for similar guitars is $1,2

00, and gibson would like to make a 30% profit on cost. what should gibson’s target cost be?
Business
1 answer:
Pachacha [2.7K]3 years ago
7 0
Given:
Current market price of similar guitar 1,200
30% profit on cost.

Sales :   130%
Cost  : <u>- 100%</u>
Profit :   30%

This means that $1,200 is 130% of cost. 

$1,200 / 1.3 = $923.10

Gibson's target cost should be $923.10 to make a 30% profit on cost.
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