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Calculate the cost-based price per cup

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Reference no: EM133040748

Question - The Coffee Revolution sells beverages in a variety of coffee flavors. Data for a recent week appear below:

Revenue (1,000 cups sold)

Cost of ingredients SAR640

Factory Rent 500

Depreciation expense -office 360 1,500

Required -

a. Suppose the company's policy is to set prices based on a 250% markup above variable cost. Calculate the cost-based price per cup.

b. What is the mark up percentage if the company adopts product cost method and the required rate of return by shareholders is 10% on total assets of SAR 10,000.

Reference no: EM133040748

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