eaner and sels each What is the percent markup based on selling price? Shurgurado Lhines decided to give a 1-year Product Replacement Policy amounting to PHP399.50. If it pays PhP75.00 to the insurance company for each product replacement policy sold, what is the percent markup based on selling price of the vacuum cleaner and policy combination? If 6,000 vacuum cleaners are sold in a season and 40% are sold with the insurance policy, how many additional "markup amount." (the gross margin), was made by offering the policy? Continuing with the information from letter c, compare the total markup amount of Shurgurado Lhines on: i. Vacuum cleaners only ii. Combination of vacuum cleaner and policy replacement offer As Operations Manager for Shurgurado Lhines, what is your opinion on offering such replacement policy considering their effect on the "profit picture" of the business?

CONCEPTS IN FED.TAX.,2020-W/ACCESS
20th Edition
ISBN:9780357110362
Author:Murphy
Publisher:Murphy
Chapter5: Introduction To Business Expenses
Section: Chapter Questions
Problem 63P
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Shurgurado Lhines is a dealer of cleaning materials. If it pays PhP1,875 for the vacuum
cleaner and sells each at PhP4,499.50.
a What is the percent markup based on selling price?
b. Shurgurado Lhines decided to give a 1-year Product Replacement Policy amounting to
PhP399.50. If it pays PHP75.00 to the insurance company for each product
replacement policy sold, what is the percent markup based on selling price of the
vacuum cleaner and policy combination?
If 6,000 vacuum cleaners are sold in a season and 40% are sold with the insurance
policy, how many additional "markup amount," (the gross margin), was made by
offering the policy?
Continuing with the information from letter c, compare the total markup amount of
Shurgurado Lhines on:
i.
C.
d.
Vacuum cleaners only
Combination of vacuum cleaner and policy replacement offer
e. As Operations Manager for Shurgurado Lhines, what is your opinion on offering
such replacement policy considering their effect on the "profit picture" of the
business?
ii.
Transcribed Image Text:Shurgurado Lhines is a dealer of cleaning materials. If it pays PhP1,875 for the vacuum cleaner and sells each at PhP4,499.50. a What is the percent markup based on selling price? b. Shurgurado Lhines decided to give a 1-year Product Replacement Policy amounting to PhP399.50. If it pays PHP75.00 to the insurance company for each product replacement policy sold, what is the percent markup based on selling price of the vacuum cleaner and policy combination? If 6,000 vacuum cleaners are sold in a season and 40% are sold with the insurance policy, how many additional "markup amount," (the gross margin), was made by offering the policy? Continuing with the information from letter c, compare the total markup amount of Shurgurado Lhines on: i. C. d. Vacuum cleaners only Combination of vacuum cleaner and policy replacement offer e. As Operations Manager for Shurgurado Lhines, what is your opinion on offering such replacement policy considering their effect on the "profit picture" of the business? ii.
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