Chat with AI
Cornerstones of Cost Management 2nd Edition by Don Hansen ,Maryanne Mowen
Edition 2ISBN: 978-1111824402Cornerstones of Cost Management 2nd Edition by Don Hansen ,Maryanne Mowen
Edition 2ISBN: 978-1111824402 Exercise 36
Markup on Cost
Many different businesses employ markup on cost to arrive at a price. For each of the following situations, explain what the markup covers and why it is the amount that it is.
a. Department stores have a markup of 100 percent of purchase cost.
b. Jewelry stores charge anywhere from 100 percent to 300 percent of the cost of the jewelry. (The 300 percent markup is referred to as "keystone.")
c. Johnson Construction Company charges 12 percent on direct materials, direct labor, and subcontracting costs.
d. Hamilton Auto Repair charges customers for direct materials and direct labor. Customers are charged $45 per direct labor hour worked on their job; however, the employees actually cost Hamilton $15 per hour.
Many different businesses employ markup on cost to arrive at a price. For each of the following situations, explain what the markup covers and why it is the amount that it is.
a. Department stores have a markup of 100 percent of purchase cost.
b. Jewelry stores charge anywhere from 100 percent to 300 percent of the cost of the jewelry. (The 300 percent markup is referred to as "keystone.")
c. Johnson Construction Company charges 12 percent on direct materials, direct labor, and subcontracting costs.
d. Hamilton Auto Repair charges customers for direct materials and direct labor. Customers are charged $45 per direct labor hour worked on their job; however, the employees actually cost Hamilton $15 per hour.
Explanation
Verified
Verified
Identify that the markup covers in the f...
Cornerstones of Cost Management 2nd Edition by Don Hansen ,Maryanne Mowen
Why don’t you like this exercise?
Other Minimum 8 character and maximum 255 character
Character 255
