Question

1. Within a given distribution channel, the following information is available concerning trade margins and costs. A wholesaler has a unit selling price of $230 and a unit cost of $140. The retailer requires a 42% markup on selling price. The manufacturer has unit variable costs of $34. Calculate the wholesaler percent markup on cost. Report your answer as a percentage and round to the nearest percent.

2. Within a given distribution channel, the following information is available concerning trade margins and costs. A wholesaler has a unit selling price of $241 and a unit cost of $115. The retailer requires a 27% markup on selling price. The manufacturer has unit variable costs of $59. Calculate the manufacturer's dollar margin per unit. Round your answer to the nearest dollar.

3. Within a given distribution channel, the following information is available concerning trade margins and costs. A wholesaler has a unit selling price of $820 and a unit cost of $477. The retailer requires a 52% markup on selling price. The manufacturer has unit variable costs of $278. Calculate the manufacturer's percent markup on cost. Report your answer as a percentage and round to the nearest percent.

PLEASE EXPLAIN ALL STEPS

Answer 1

1.

A wholesaler has a unit selling price of $230 and a unit cost of $140.

Wholesales mark up = Wholesaler selling price - Wholesaler cost price

= 230 - 140

= $90

wholesaler percent markup on cost = Wholesaler mark up/Wholesaler cost price

= 90/140

= 64%

2.

A wholesaler has a unit selling price of $241 and a unit cost of $115.

Cost of wholesaler is the selling price of the manufacturer

Hence, selling price of manufacturer = $115

The manufacturer has unit variable costs of $59.

Manufacturer's dollar margin per unit = Manufacturer's selling price - Manufacturer's cost

= 115 - 59

= $56

3.

A wholesaler has a unit selling price of $820 and a unit cost of $477.

Cost of wholesaler is the selling price of the manufacturer

Hence, selling price of manufacturer = $477   

The manufacturer has unit variable costs of $278

Manufacturer's dollar margin per unit = Manufacturer's selling price - Manufacturer's cost

= 477 - 278

= $199

Manufacturer's percent markup on cost = Manufacturer's dollar margin/Manufacturer's cost

= 199/278

= 72%