The owners of Monkey Co. invested P 1,000,000 to start a computer shop business. The firm...

 

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The owners of Monkey Co. invested P 1,000,000 to start a computer shop business. The firm also applied another P 1,000,000 loan from a bank to increase the cash needed for operations. Aside from the initial capital expenditures, the projected costs for a 2,000 production volume are the following: Production Costs 800,000 Operating Expenses 400,000 Since information technology is a boom nowadays, the investors are anticipating a 50% return of their investment every year. 1. 2. What should be the selling price using the ROI method? What should be the selling price using full cost method, with 50% mark up? Whitey Corp. would like to introduce a new refrigerator which provides a new melting mechanism. In the market, the competitor offers one unit at P 30,000. The firm would like to achieve a 40% mark up. 1. If the estimated cost proposed by the designer is P 17,000 per unit, identify two options that may be done by the firm. Explain the effect of the option on income per unit a. b. The owners of Monkey Co. invested P 1,000,000 to start a computer shop business. The firm also applied another P 1,000,000 loan from a bank to increase the cash needed for operations. Aside from the initial capital expenditures, the projected costs for a 2,000 production volume are the following: Production Costs 800,000 Operating Expenses 400,000 Since information technology is a boom nowadays, the investors are anticipating a 50% return of their investment every year. 1. 2. What should be the selling price using the ROI method? What should be the selling price using full cost method, with 50% mark up? Whitey Corp. would like to introduce a new refrigerator which provides a new melting mechanism. In the market, the competitor offers one unit at P 30,000. The firm would like to achieve a 40% mark up. 1. If the estimated cost proposed by the designer is P 17,000 per unit, identify two options that may be done by the firm. Explain the effect of the option on income per unit a. b.

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1 Selling Price using ROI Method for Monkey Co To calculate the selling price using the ROI Return on Investment method we need to consider the desire... View the full answer