Raffles Company Routinely Bids on Construction Jobs

question 65

Multiple Choice

Raffles Company routinely bids on construction jobs.Raffles first determines the budgeted product cost of the job and then applies a markup of 50%.If a bid of $15,000 is submitted for a new job,which of the following is true?

• A)budgeted product cost is $15,000
• B)$5,000 is pure profit
• C)all costs pertaining to the job total $15,000
• D)$5,000 includes fixed overhead,selling and administrative expense,and profit
• E)$5,000 includes selling and administrative expense,and profit