QRB/501 Week Three Case Study; 9-1 Acupuncture, Tea, and Rice-Filled Heating Pads

profilejule_b1

Karen is an acupuncturist with a busy practice. In addition to acupuncture services, Karen sells teas, herbal supplements, and rice-filled heating pads. Because Karen’s primary income is from acupuncture, she feels that she is providing the other items simply to fill a need and not as an important source of profits. As a matter of fact, the rice-filled heating pads are made by a patient who receives acupuncture for them instead of paying cash. The rice-filled pads cost Karen $5.00, $8.00, and $12.00, respectively, for small, medium, and large sizes. The ginger tea, relaxing tea, cold & flu tea, and detox tea cost her $2.59 per box plus $5.00 shipping and handling for 24 boxes. Karen uses a cost plus markup method, whereby she adds the same set amount to each box of tea. She figures that each box costs $2.59 plus $0.21 shipping and handling, which totals $2.80, then she adds $0.70 profit to each box and sells it for $3.50. Do you think this is a good pricing strategy? How would it compare to marking up by a percent- age of the cost?

 

  1. What is the markup percentage for a box of ginger tea?
  2. If the rice-filled heating pads sell for $7.00, $10.00, and $15.00 for small, medium, and large, respectively, what is the markup percentage on each one?
  3. Karen wants to compare using the cost plus method to the percentage markup method. If she sells 2 small rice pads, 4 medium rice pads, 2 large rice pads, and 20 boxes of $3.50 tea in a month, how much profit does she accumulate? What markup percentage based on cost would she have to use to make the same amount of profit on this month’s sales?
  4. What prices should Karen charge (using the markup percentage) to obtain the same amount of profit as she did with the cost plus method? Do not include shipping.
  • 10 years ago
  • 10
Answer(9)

Purchase the answer to view it

blurred-text
  • attachment
    qrb_501.xls

Purchase the answer to view it

blurred-text
  • attachment
    excellll.xls
  • attachment
    case_study.docx

Purchase the answer to view it

blurred-text
NOT RATED
  • attachment
    qrb_501_excel_solutionkaren.xlsx

Purchase the answer to view it

blurred-text
NOT RATED
  • attachment
    qrb501_9.1_case_templates.xls

Purchase the answer to view it

blurred-text
NOT RATED
  • attachment
    qrb_501_week_three_case_study_8-3__9-1.doc
  • attachment
    qrb_501_week_three_case_study_8-3__9-1.xls

Purchase the answer to view it

blurred-text
NOT RATED
  • attachment
    qrb501_answer..doc
  • attachment
    qrb501_answer.xls

Purchase the answer to view it

blurred-text
NOT RATED
  • attachment
    qrb_501_week_3_learning_team_case_studies.xlsx

Purchase the answer to view it

blurred-text
NOT RATED
  • attachment
    qrb_501_entire_course.zip

Purchase the answer to view it

blurred-text
NOT RATED
  • attachment
    qrb_501_week_3_week_three_learning_team_case_studies.zip