Part 1. Company A is a distributor which is trading with product B. Product B is received to the supplier at 9.2$ the shipment is 15% and customs are 5% to deliver them to the distributor. In addition, Overhead cost is 20% and Margin needed is 50%.

Q1. What is the calculated cost and selling price of Product B for the distributor?

Part 2. The distributor is facing high competition in the market and would want to sell at a lower price. The distributor contacted the supplier to lower the costs on them. The supplier replied that the difference between the calculated selling price of the distributor and the needed price of the client will be shared equally by both the distributor and supplier.

Q2. Would the distributor be better off or worse off with such a deal?

Note: Please use examples to calculate and prove the answers.

Answer rating: 100% (QA)

Step 1 Part1 1Cost to the distributor Suppliers purchase costShipment cost Customs 1Suppliers margin ... View the full answer