If a Haberdasher Purchases a Tie for $12 and Plans

question 132

Multiple Choice

If a haberdasher purchases a tie for $12 and plans to sell it for $18,the percentage of retail price markup would be:

• A)33%.
• B)50%.
• C)175%.
• D)100%.

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Definitions:

Fixed Manufacturing Overhead

The consistent, non-variable costs associated with manufacturing, regardless of the production volume.

Direct Materials

Raw materials that are directly used in the production of goods and can be easily traced to the product.

Direct Labour

The workforce directly involved in manufacturing goods or providing services, where their labor can be directly tied to end products.

Variable Manufacturing Overhead

Costs in the production process that vary with the level of output, such as utilities for the machinery.