Calculating costs from price/kg and % of client's purchases

Case Calculations
New answer on Sep 17, 2019
2 Answers
1.5 k Views
Anonymous A asked on Sep 17, 2019

Hello,

Can you please tell me, what formula/koncept is used to get cost of material when I know the price/kg and % of the client's material purchases? I can see from the case that the price/kg is multiplied by the percentage, so for example $80/kg*40%=$32 but I wouldn't be able to come with this step. Could you please advise what the idea behind it is so I would be able to use it next time?

Thank you

Overview of answers

Upvotes
  • Upvotes
  • Date ascending
  • Date descending
Best answer
Vlad
Expert
Content Creator
replied on Sep 17, 2019
McKinsey / Accenture Alum / Got all BIG3 offers / Harvard Business School

Hi,

Your question is completely unclear. If the cost is the % of the price, then you simply multiply the two numbers

Best

Was this answer helpful?
Raymont
Skilled
replied on Sep 17, 2019

Hi

Your question isn't absolutely clear. If you share the question verbatim, I might be of more assitance.

To confirm: you were asked to calculate Cost of raw material. You were given Price/Kg and % of the price that is material purchase.

To me it then seems fairly obvious that the CoM would be the % mulitplied by the price/kg.

Was this answer helpful?
1
Vlad gave the best answer

Vlad

Content Creator
McKinsey / Accenture Alum / Got all BIG3 offers / Harvard Business School
426
Meetings
11,812
Q&A Upvotes
127
Awards
4.9
186 Reviews