Assume the margin is expressed as markup based on cost

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Reference no: EM131915032

TRADING MARGINS AND SELLING PRICES

1. Shannon’s Brewery has developed a super-premium craft beer to be marketed as Shannon’s Irish Stout. The cost of production (brewing, canning, etc.) is about $4.18 per six pack. If Shannon’s needs a 12% margin what will Shannon’s price per six pack be to its distributor, Miller of Denton? Assume the margin is expressed as a markup based on cost. Compute your answer to the nearest penny.

2. Shannon’s Brewery has developed a super-premium craft beer to be marketed as Shannon’s Irish Stout. The cost of production (brewing, canning, etc.) is about $4.06 per six pack. If Shannon’s needs a 10% margin what will Shannon’s price per six pack be to its distributor, Miller of Denton? Assume the margin is expressed as a markup based on selling price. Compute your answer to the nearest penny.

3. Shannon’s craft beers are sold via a three tier distribution channel, consisting of its brewery, a distributor (Miller Distributing) and the retailer. At the retail level, a six pack of its craft beer sells for about $12.00. If the typical retailer demands a 50% markup based on selling price and the distributor also wants a 38% markup based on selling price, what will be the maximum that Shannon’s can charge the distributor for a six pack? Compute your answer to the nearest penny.

4. Shannon’s has developed a super-premium craft beer to be marketed as Shannon’s Irish Stout. The cost of production (brewing, canning, etc.) is about $4.00 per six pack. If Shannon’s needs a 10% margin, the distributor needs 40% and the retailer needs 53%, what will be the likely selling price suggested by Shannon’s to retailers? Assume all margins are expressed as markups based on selling price. Compute your answer to the nearest penny.

Reference no: EM131915032

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