Business, 07.05.2020 05:01 00manray

Babcock Co. manufactures fast-baking ovens in the U. S. at a production cost of $500 per unit & sells them to uncontrolled distributors in the U. S. and a wholly owned sales subsidiary in Canada. Babcock's U. S. distributors sell the ovens to restaurants at a price of $1000 and it's Canadian subsidiary sells the ovens at a price of $1,100. Other distributors of ovens to restaurants in Canada normally earn a gross profit equal to 25% of selling price. Babcock's main competitor in the U. S. sells fast-baking ovens at an average 50% markup on cost. Babcock's Canadian sales subsidiary incurs operating costs, other than cost of goods sold, that average $250 per oven sold. The average operating profit margin earned by Canadian distributors of fast-baking ovens is 5%. WHAT WOULD BE THE PRICE UNDER THE RESALE METHOD?

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Babcock Co. manufactures fast-baking ovens in the U. S. at a production cost of $500 per unit &...

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