Question

#6. Allied Laboratories is combing some of its most common tests into one-price packages. One such package will contain three tests that have the following variable costs: Test A Test B Test C Disposable Syringe $4.00 $4.00 $4.00 Blood Vial $0.50 $0.50 $0.50 Forms $0.15 $0.15 $0.15 Reagents $0.80 $0.60 $1.20 Sterile Bandages $0.20 $0.20 $0.20 Breakage/losses $0.05 $0.05 $0.05 When the tests are combined, only one syringe, form, and sterile bandage will be used. Furthermore, only one charge for breakage/losses will apply. Two blood vials are required, and reagent costs will remain the same (reagents from all three tests are required - so add up those costs). Assuming marginal cost pricing, what is the cost of the combined test? Choice: $3.00 Choice: $4.50 to 000D Choice: $6.90 .000, B olo noso Choice: $8.00 do bodo

Answer 1

6. Answer is d. $8

Disposale Syringe	$                  4.00
Blood Vial	$                  1.00	=0.5*2
Form	$                  0.15
Reagents	$                  2.60	=0.8+0.6+1.2
Sterlite Bandages	$                  0.20
Breakage	$                  0.05
Total Cost	$                  8.00

7. Price to be charged = Variable cost + Contribution Margin
= $8+ $10 = $18

Answer is c. $18

8. Total Revenue required = 2000 x $8 + $50000 = $66000
Selling price per unit to cover all costs = $66000/2000 = $33

Answer is c. $33

9. Total Revenue required = 2000 x $8 + $50000 + $25000 = $91000
Selling price per unit to cover all costs = $91000/2000 = $45.50

Answer is c. $45.50