Answer:
Product cost: $
Variable production cost 5.00
Variable selling cost 2.00
Total variable cost 7.00
Total fixed cost 3.00
Total cost 10.00
Desired profit 8.00
Selling price 18.00
Mark-up percentage on product cost
= 8 x 100
10
= 80%
Explanation:
In this case, we will divide the profit by the total cost in order to obtain the mark-up percentage on cost. The total cost equals $10 while the profit is $8. The division of profit by total cost multiplied by 100 gives the mark-up percentage on product cost.
