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Question 1.7 on the 2015 BBP revision kit,where does the 20% of sales price come from in the answers..what i did was 8.40 – ( 10 – 25%)=0.9 wich is very wrong..thank you
You have taken the target profit as being 25% of selling price. The question says that it is 25% of cost!
So for every 100 cost, the profit will be 25, and therefore the selling price will be 125.
Or, to put it the other way round, for every 125 selling price, the cost will be 100.So for a selling price of $10, the cost will be 100/125 x $10 = $8
pliz explain the ansa for me……target selling price 20 p.u
target profit margin 30%
estimated production cost 16 p.u
what is the cost gap?Target SP = 20
Target profit margin (30%x20) = 6
Target Cost (20-6) = 14
Estimated Cost = 16
Cost Gap (16-14) = 2(to be more clear please watch the video lecture)
Amit: Thank you for answering, but please of not answer in this forum – it is Ask the Tutor, and you are not the tutor 🙂
Please do however answer questions in the general F5 forum 🙂 )Mcedisi: Amit is correct and I am pleased that he sorted it out for you 🙂
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