ritadominquez5255 ritadominquez5255

Today at 4:45 PM
Business

Answered

When using the product cost method of applying the cost-plus approach to product pricing, which of the following is included in the markup?

a. desired profit
b. total fixed manufacturing costs, total fixed selling and administrative expenses, and desired profit
c. total costs plus desired profit
d. total selling and administrative expenses plus desired profit

Answer :

DelcieRiveria DelcieRiveria

Today at 4:50 PM

Answer:

The correct answer is option d.

Explanation:

The total product cost method of applying the cost-plus approach to product pricing includes total selling and administrative expenses plus desired profit in the markup.

The reason behind this is that while total manufacturing costs are included in the product cost, the total selling and administrative cost is not included. So the total selling and administrative expenses plus desired profit are included in the markup.

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