So if a company still wants to make $2 profit per bottle.
Company raises price to $6.25 to try to cover the tariff (25% increase)
The tariff becomes $1.56 ($6.25 × 25%)
Instead of selling for $5 price, they would sell it for $4.69 effectively ($6.25-$1.56)
Instead of making $2 profit, they would make $1.69 profit ($4.69-$3(production cost))
If they still sold the bottle for $5, paid $1.25 tariff
They would make 75 cents of profit ($5-$3(production cost)-$1.25(tariff))