Raffles Company routinely bids on construction jobs. Raffles first determines the budgeted product cost of the job and then applies a markup of 50%. If a bid of $15,000 is submitted for a new job, which of the following is true?
A) budgeted product cost is $15,000
B) $5,000 is pure profit
C) all costs pertaining to the job total $15,000
D) $5,000 includes fixed overhead, selling and administrative expense, and profit
E) $5,000 includes selling and administrative expense, and profit
E
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