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Assume That the Company Has Not Yet Determined a Markup

Question 120

Multiple Choice

Assume that the company has not yet determined a markup to use on the new product.The new product would require an investment of $1,200,000.The company requires a 25% rate of return on investment in all new products.The markup under the absorption costing approach would be closest to:


A) 70.0%
B) 50.0%
C) 83.3%
D) 63.3%

Correct Answer:

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