prepares fresh gourmet entrees each day on Wednesday 80 baked chicken dinners were made at a cost of 3.50 each. a 10% spoilage rate is anticipated. at what price should the dinners be sold to achieve a 60% markup based on selling price.
0.9 * 80 = 72
(3.5 * 72 * 1.6)/80 = $5.04
Cxf
To determine the selling price of the baked chicken dinners, we need to consider the cost, spoilage rate, and desired markup.
Let's start by calculating the total cost of the chicken dinners. We know that 80 dinners were made at a cost of $3.50 each. Therefore, the total cost is:
Total Cost = Number of Dinners * Cost per Dinner
Total Cost = 80 * $3.50 = $280
Next, we need to account for the anticipated spoilage rate of 10%. To calculate the number of dinners that will be sold, subtract the spoilage rate from the total number of dinners made:
Number of Dinners Sold = Total Number of Dinners - (Total Number of Dinners * Spoilage Rate)
Number of Dinners Sold = 80 - (80 * 0.10) = 80 - 8 = 72
Now, let's determine the desired selling price based on a 60% markup. The selling price can be calculated using the formula:
Selling Price = Cost / (1 - Desired Markup)
In this case, the desired markup is 60%, which can be written as 0.60.
Selling Price = $280 / (1 - 0.60)
Selling Price = $280 / 0.40
Selling Price = $700
Therefore, the baked chicken dinners should be sold at a price of $700 to achieve a 60% markup based on the selling price.