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Schopp Company makes swimsuits and sells these suits directly to retailers. Although Schopp has a variety of suits, it does not make the All-Body suit used by highly skilled swimmers. The market research department believes that a strong market exists for this type of suit. The department indicates that the All-Body suit would sell for approximately $114. Given its experience, Schopp believes the All-Body suit would have the following manufacturing costs.
Direct materials $29
Direct labor 28
Manufacturing overhead 45
Total costs $102
Assume that Schopp uses cost-plus pricing, setting the selling price 24% above its costs. What would be the price charged for the All-Body swimsuit?
assume that Schopp uses target costing. What is the price that Schopp would charge the retailer for the All-Body swimsuit?
What is the highest acceptable manufacturing cost Schopp would be willing to incur to produce the All-Body swimsuit, if it desired a profit of $26 per unit?

Respuesta :

If Schopp uses cost-plus pricing, setting the selling price 24% above its costs than the price charged for the All-Body swimsuit is $126.48.

Cost-plus pricing is a rating strategy by that the price of a product is set by adding a particular mounted share to the product's cost. basically, the markup share could be a technique of generating a selected desired rate of come back. an alternate rating technique is value-based rating.

Manufacturing cost is that the total of prices of all resources consumed within the method of creating a product. The producing value is assessed into 3 categories: direct materials value, direct labor value and producing overhead. it's an element in total delivery value.

To learn more about cost-plus pricing here

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