Question

A digital camera manufacturing company has the cost data given in the following table:

Sales price	$783
Units sold	29,669
Direct labor	$1,503,075
Materials	$6,348,961
Overhead	$2,614,707
Total operating expense	$2,740,386
% Profit

Calculate the percentage profit

Answer 1

Based in the cost data provided let me show you the calculation of Percentage profit:

We can either calculate the percentage profit on the Total Sales or on Per unit sales. I am showing both ways:

1. On Total sales :

Total Sales = Sales price * Units sold = 783 * 29669 = $23,230,827

Total Cost of Goods Sold = Direct Labour + Materials + Overhead + Total Operating expenses

= $15,03,075 + $6,348,961 + $2,614,707 + $2,740,386 = $13,207,129

Gross Profit = Sales - Cost of Goods Sold = $23,230,827 - $13,207,129 = $10,023,698

Percentage profit = Gross profit / Sales * 100 = $10,023,698 / $23,230,827 * 100 = 43.15 %

2. On Per unit sales

Sales per unit = $783

Per unit

Direct Labour Cost = $50.66 Materials = $213.99 Overhead = $88.12 Total Operating expenses = $92.36

Cost of Goods sold per unit = $445.13

Gross profit = Sales - Cost of Goods sold = $783 - $445.13 = $337.87

Percentage profit = $337.87 / $783 * 100 = 43.15%