Southeast U's campus book store sells course packs for $15.00each, the variable cost per pack is $12.00,
Fantastic news! We've Found the answer you've been seeking!
Question:
Southeast U\'s campus book store sells course packs for $15.00each, the variable cost per pack is $12.00, fixed costs for thisoperation are $300,000, and annual sales are 95,000 packs. The unitvariable cost consists of a $3.00 royalty payment, VR , per pack toprofessors plus other variable costs of VO = $7.00. The royaltypayment is negotiable. The book store\'s directors believe that thestore should earn a profit margin of 10% on sales, and they wantthe store\'s managers to pay a royalty rate that will produce thatprofit margin. What royalty per pack would permit the store to earna 10% profit margin on course packs, other things heldconstant?
Related Book For
Accounting for Decision Making and Control
ISBN: 978-0078025747
8th edition
Authors: Jerold Zimmerman
Posted Date: