Yakking Co.manufactures mobile cellular equipment and develops a price for the product by using the variable cost concept.Yakking incurs variable costs of $1,900,000 in the production of 100,000 units while fixed costs total $50,000.The company employs $4,725,000 of assets and wishes to earn a profit equal to a 10% rate of return on assets.
a Compute a markup percentage based on variable cost.
b Determine a selling price.

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The Answer of Yakking Co.manufactures mobile cellular equipment and develops a price for the product by using the variable cost concept.Yakking incurs variable costs of $1,900,000 in the production of 100,000 units while fixed costs total $50,000.The company employs $4,725,000 of assets and wishes to earn a profit equal to a 10% rate of return on assets.
a Compute a markup percentage based on variable cost.
b Determine a selling price.