Question - Oma 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
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$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 $150,000?
c. What is the markup on manufacturing costs needed to obtain a target profit of $250,000?