Yes you are right my calc was incorrect and yours is correct. In...

Yes you are right my calc was incorrect and yours is correct.

In previous correspondence they have stated that they aim at a GP of 40%. GP is Sales price less cost of manufacture or COG.

Valuation Rule: The rule for reporting inventory is that it must be valued at acquisition cost or market value, whichever is the lower amount. In general, inventories should be valued at acquisition costs.

40% GP is acceptable for a manufacturing company that outsources its manufacturing costs. They buy at a fixed cost which is easier to control than having your own factory.