Question: 1. An appliance retailer purchased a small vacuum cleaner for $98.99. He plans to take a 45% markup. What will the selling price be?
2. If a retailer sells a coat for $149.99. What was his markup if he bought the coat for $86.00.
Markup in actual dollars ________
Express markup as a % of cost _________
Express markup as a % of selling price ________
3. The Smith Company sells beautiful water fountains through wholesalers and retailers. The retail selling price is $ 1400.00, and the manufacturing cost to the company is $535.00. The retail markup was 38 percent and wholesale markup was 25 percent.
A. What was the cost to the wholesaler?__________
B. What was the cost to the retailer? ____________
C. What percentage markup did the producer make?__________
4. The Pointer Appliance Company is investigating the additional of a new and improved pulsating blender to its line of consumer appliances. The product chops, grinds, grates and blends smoothies twice as fast as all other blenders on the market. It has a 10 year warranty on the motor and offers a replacement 5 cup glass blender cup for $10.99. The blender is going to require additional expenditures for the production line on the part of the Pointer Company. Management wants to determine what to price the blender at. The total fixed cost associated with manufacturing the blenders is $525,000. The variable cost is $17.99 per unit. Given the costs for adding the blender, management is considering selling the blender at one of these prices: $25.99, $34.99 and $49.99. Calculate the breakeven point in units at each of the selling prices: $25.99, $34.99 and $49.99 and show the calculations. Through your research you know that this is a tough competitive market with many competitors. Most competitors have between 2-8% of the market and the market appears to be growing at a 5% rate per year. The total market for blenders of this type was 1,500,000 units last year. Given that the market leader is selling its blender for $39.99, which price would you recommend and why?
5. Yoplait has new line of Greek yogurt in a 9 oz size. The Marketing Managers plan to test market the product in one small market for three weeks. They has calculated the cost and projected sales for each of the different flavors: Plain cost is .55 each with a projected sales of 15,000 units, Strawberry cost per unit is .60 with a projected sales of 15,000 units, Blueberry cost are .68 per unit with a projected sales of 11,000 units. Each yogurt product will retail at the same price. Using the average cost pricing and a 45% markup what will Yoplait price these product at the retail level.
6. MyAppliance+ is adding a new wine cooler to its appliance product mix. To implement the new cooler it will have a fixed cost of $250,000 but the selling price is $150.00 with a variable cost of $86.99. MyAppliance+ wants to make at least $50,000 of profit the first year with this new product. How many wine coolers does the company have to sell to reach this profit goal?