Harris Company Produces a Product Whose Cost Is $10

question 141

Multiple Choice

Harris Company produces a product whose cost is $10.Assuming the company uses a cost-plus pricing system,what selling price would the company set to earn a profit margin of 20% of cost?

• A) $2.00
• B) $12.50
• C) $50.00
• D) $12.00

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Definitions:

Financing Activity

Transactions and events where cash is raised for investing in the business or repaying funds borrowed by the company, supplied through equity or debt.

Income Ratio

A metric used to evaluate the performance of a company by comparing income to other financial figures, often referred to as a profitability ratio.

Operating Activities

The day-to-day actions that are involved in running a business and generating revenue, such as selling products or services.