Question: Timothy Company has budgeted operating income of $104,000 with the following budgeted costs:
Direct materials $168,000
Direct manufacturing labor 132,000
Factory overhead:
Variable 96,000
Fixed 108,000
Selling and administrative expenses:
Variable 72,000
Fixed 100,000
Compute the average markup percentage for setting prices as a percentage of:
- The full cost of the product
- Variable manufacturing costs