Question

Angie's bake shop makes birthday chocolate chip cookies that cost $2 each. angie expects that 10% of the cookies will crack and be discarded. angie wants a 60% markup on cost and produces 100 cookies. what should angie price each cookie? (round your answer to the nearest cent.)

Answer 1

The first thing to do is to know how many cookies Angie needs to produce knowing that 10% of her production is going to crack.
 To produce 100 cookies, Angie must:
 90% ---> 100
 100% ---> x
 Clearing x:
 x = (100/90) * (100)
 x = 111.1111111
 Angie must make 111 cookies.
 Each cookie costs $ 2
 We have then:
 (111.11) * (2) = 222.22 $
 As only 100 cookies are sold (the rest is broken):
 222.22 / 100 = 2.22 $
 Each cookie costs 2.22 $
 As Angie wants a 60% profit then:
 2.22 * 1.6 = 3.56 $
 Answer:
 angie should price 3.56 $ each cookie

Answer 2

Angie expects to sell 90 cookies, discarding 10 of them for being cracked. These cookies will cost her $200 to produce. A 60% markup would be $120, so she wants to make a total of $320 on each of 90 cookies. She should charge $320/90 = $3.56 per cookie.