Answer:
Product cost: Â Â Â Â Â Â Â Â Â Â $
Variable production cost 5.00
Variable selling cost     2.00
Total variable cost      7.00                            Â
Total fixed cost         3.00
Total cost              10.00
Desired profit          8.00
Selling price            18.00
Mark-up percentage on product cost Â
= Â 8 Â x 100
  10     Â
= 80% Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â
Explanation:
In this case, we will divide the profit by the total cost in order to obtain the mark-up percentage on cost. The total cost equals $10 while the profit is $8. Â The division of profit by total cost multiplied by 100 gives the mark-up percentage on product cost.
