Reference no: EM133031162
Problem - Hershey, Inc. sells a single product. The following information relates to the year just ended:
Number of units sold: 40,000
Variable cost per unit: $200
Total fixed cost: $2,400,000
Invested capital 12,000,000
ROI 30%
Required -
A. Compute the company's selling price.
B. Compute the percentage mark-up on total cost. Round your answer to two decimal places.
C. Assume that Hershey desired to change its practice of computing a mark-up on total cost to a mark-up on variable cost. If the company wants to hold selling price constant, would the mark-up percentage increase or decrease? By how much? and why?