Computing Markups
The predicted 2009 costs for Osaka Motors are as follows:
Manufacturing Costs
Selling and Administrative Costs
Variable
$100,000
Variable
$300,000
Fixed
230,000
Fixed
200,000
To compute markups for Osaka Motors, we need to determine the total cost and sales price for each product. Assuming there is only one product, we can calculate the markups using the following steps:
Step 1: Calculate the total manufacturing costs:
Total Manufacturing Costs = Variable Manufacturing Costs + Fixed Manufacturing Costs
Total Manufacturing Costs = $100,000 + $230,000 = $330,000
Step 2: Calculate the total selling and administrative costs:
Total Selling and Administrative Costs = Variable Selling and Administrative Costs + Fixed Selling and Administrative Costs
Total Selling and Administrative Costs = $300,000 + $200,000 = $500,000
Step 3: Calculate the markup percentage:
Markup Percentage = (Total Manufacturing Costs + Total Selling and Administrative Costs) / Total Manufacturing Costs
Markup Percentage = ($330,000 + $500,000) / $330,000
Step 4: Calculate the markups:
Markup = Markup Percentage * Total Manufacturing Costs
Markup = Markup Percentage * $330,000
Please provide the predicted sales price for the product so we can calculate the markups more accurately.
To compute the markups for manufacturing costs and selling and administrative costs for Osaka Motors, we need to understand the concept of markups.
Markup refers to the additional amount added to the cost of a product or service to determine its selling price. It is usually expressed as a percentage of the cost.
To calculate the markups for manufacturing costs and selling and administrative costs, we need to know the selling price and the cost.
Let's assume the selling price for Osaka Motors is $500,000. Now, we can calculate the markups.
1. Computing the markup for manufacturing costs:
Manufacturing costs consist of both variable and fixed costs.
Variable costs: $100,000
Fixed costs: $230,000
Total manufacturing costs: Variable costs + Fixed costs = $100,000 + $230,000 = $330,000
Markup for manufacturing costs: Markup percentage * Total manufacturing costs = Selling price - Total manufacturing costs
Markup percentage = (Selling price - Total manufacturing costs) / Total manufacturing costs
Markup percentage = ($500,000 - $330,000) / $330,000
Markup percentage = $170,000 / $330,000
Markup percentage ≈ 0.515
So, the markup for manufacturing costs is approximately 51.5%.
2. Computing the markup for selling and administrative costs:
Selling and administrative costs also consist of variable and fixed costs.
Variable costs: $300,000
Fixed costs: $200,000
Total selling and administrative costs: Variable costs + Fixed costs = $300,000 + $200,000 = $500,000
Markup for selling and administrative costs: Markup percentage * Total selling and administrative costs = Selling price - Total selling and administrative costs
Markup percentage = (Selling price - Total selling and administrative costs) / Total selling and administrative costs
Markup percentage = ($500,000 - $500,000) / $500,000
Markup percentage = $0 / $500,000
Markup percentage = 0
So, the markup for selling and administrative costs is 0%.
In summary, the markup for manufacturing costs is approximately 51.5%, while the markup for selling and administrative costs is 0%.