Timothy Company has invested $2,000,000 in a plant to make vending machines. The target operating income desired from the plant is $300,000 annually. The company plans annual sales of 1,500 vending machines at a selling price of $2,000 each.
1. What is the target rate of return on investment for Timothy Company?
2. What is the markup percentage as a percentage of cost for Timothy Company?
1. What is the target rate of return on investment for Timothy Company? ...
This explains the steps to calculate the rate of return on new plant and markup