Write the formula for pricing the product under cost plus pricing.

Cost-plus pricing is a method where the selling price of a product is determined by adding a markup (profit margin) to the total cost of producing and selling the unit. The formula for cost-plus pricing is:

$$\text{Selling Price}=\text{Total Cost per Unit}+\text{Desired Profit per Unit}$$

Where:

• Total Cost per Unit = Fixed Cost per Unit + Variable Cost per Unit
• Fixed Cost per Unit = Total Fixed Cost / Number of Units Produced
• Variable Cost per Unit = Direct Material Cost + Direct Labor Cost + Other Variable Costs
• Desired Profit per Unit = (Profit Margin %) × Total Cost per Unit

Alternatively, if the profit is added as a fixed percentage of the total cost, the formula can be written as:

$$\text{Selling Price}=\text{Total Cost per Unit}\times (1+\text{Markup Percentage})$$

This ensures that all costs are covered, and a predetermined profit margin is achieved.