HIT Company provides the following cost information related to its production of

Question

HIT Company provides the following cost information related to its production of its primary product:
Per Unit
Variable manufacturing cost.......................... $40
Fixed manufacturing cost.............................. 40
Variable selling and administrative expenses...... 10
Fixed selling and administrative expenses......... 12
Desired ROI per unit..................................... 14
What is the markup percentage, assuming that HIT Company uses absorption (product) costing?

a 260%
b 17.5%
c 45%
d 27.5%

Explanation / Answer

c 45%

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