Question - Nana Company has the following budgeted costs for 10,000 units:
Variable Costs Fixed Costs
Manufacturing $400,000 $150,000
Selling & Administrative 200,000 50,000
Total $600,000 $200,000
Required:
a. What is the markup on variable costs needed to break even?
b. What is the markup on variable costs needed to obtain a target profit of $100,000?
c. What is the markup on manufacturing costs needed to obtain a target profit of $200,000?