SawTown Tools uses cost-plus pricing with a 30% mark-up. The company is currently selling 80,000...
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SawTown Tools uses cost-plus pricing with a 30% mark-up. The company is currently selling 80,000 units at $65 per unit. Each unit has a variable cost of $47. In addition, the company incurs $240,000 in fixed costs annually. If demand falls to 40,000 units and the company wants to continue to charge the same price per unit, what markup percentage is the company using?
A. 22.6%
B. 26.2%
C. 36.1%
D. 30.1%
Please Show All Steps. Thank You.
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