spectrum corp desires a 25% target gross profit after covering all product costs: considering the total product costs assigned t
1 answer:
Answer:
Note: "<em>The full question is attached as picture below"</em>
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Required selling price for product = Total product cost / Product cost as a percentage of selling price
Note: <em>When the gross profit rate is 25%, this means that Product cost as a percentage of selling price is 75%</em>
Total cost assigned for product C = $1,396
Total cost assigned for product D = $3,158
<em>What would Oak have to charge the customer to achieve that gross profit?</em>
Charge to the customer for Product C:
= $1,396 / 0.75
= $1861.333333333333
= $1,861.33
Charge to the customer for Product D:
= $3,158 / 0.75
= $4210.666666666667
= $4,210.67
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Answer:
The investor will pay up the rereofitted pumps in a period of 22.52 months.
Explanation:
<em><u>First,</u></em> we solve for the amount of profit generate per month:
21,000 gallons a month x $0.09 per gallon = $1,890
Now, we calcualte the time at which an monthly income of 1890 discounted at 2% per month matches a present value of 34,000
C $1,890.00
time n
rate 0.02
PV $34,000.0000
We use logarithmics properties to solve for n:
-22.52006579
n = 22.5200 = 22 and a half month.