Jabal Corporation makes a product with the following costs:
The company uses the absorption costing approach to cost-plus pricing described in the text. The pricing calculations are based on budgeted production and sales of 28,000 units per year.
The company has invested $560,000 in this product and expects a return on investment of 10%.
The markup on absorption cost would be closest to:
A) 46.0%
B) 10.0%
C) 141.1%
D) 49.7%

Question

Jabal Corporation makes a product with the following costs: 
The company uses the absorption costing approach to cost-plus pricing described in the text. The pricing calculations are based on budgeted production and sales of 28,000 units per year.
The company has invested $560,000 in this product and expects a return on investment of 10%.
The markup on absorption cost would be closest to:
A) 46.0% 
B) 10.0% 
C) 141.1% 
D) 49.7%

Quizplus · Accepted Answer

The Answer of Jabal Corporation makes a product with the following costs: 
The company uses the absorption costing approach to cost-plus pricing described in the text. The pricing calculations are based on budgeted production and sales of 28,000 units per year.
The company has invested $560,000 in this product and expects a return on investment of 10%.
The markup on absorption cost would be closest to:
A) 46.0% 
B) 10.0% 
C) 141.1% 
D) 49.7%

Jabal Corporation Makes a Product with the Following Costs