Question 1

The list price of a coat is $125.00. A retailer is able to purchase the coat for $106.25.
What is the rate of trade discount?

Accepted Answer

The answer of The list price of a coat is...

Question 2

An invoice dated March 15 for $400 with terms 2/10, 1/20, EOM, was received on March 20. By what date should the invoice be paid to qualify for the 2% discount?

Accepted Answer

The answer of An invoice dated March 15 for $400...

Question 3

The Pro Shop at Sunny Lake Golf and Country Club prices its golf club sets to allow for overhead of 33 $\frac{1}{3}$ % of cost and profit of 20% of cost.
a) What is the regular selling price as a percentage of cost?
b) What discount rate can the Pro Shop offer to club members if it will accept half of the normal profit on member purchases?

Accepted Answer

The answer of The Pro Shop at Sunny Lake Golf...

Question 4

Sutton Trucking made two equal payments, on June 25 and July 15, on an invoice for $6,350 dated June 15 with terms 3/10, 1/30, n/60. The payments reduced the balance owed on the invoice to $1,043.33. What was the amount of each payment?

Accepted Answer

The answer of Sutton Trucking made two equal payments, on...

Question 5

Digital Devices sets its retail prices on computers, monitors, and printers to generate a rate of mark-up on selling price of 30%. Overhead expenses normally work out to be 30% of cost. What is the operating profit on a monitor that costs $345?

Accepted Answer

The answer of Digital Devices sets its retail prices on...

Question 6

A wholesaler advertises a 25% discount on all clothing. You buy several sweaters for $48.75 each for your retail boutique. What was the wholesaler's list price per sweater?

Accepted Answer

The answer of A wholesaler advertises a 25% discount on...

Question 7

Prestige Clothiers' regular prices for menswear are set to provide a rate of mark-up on selling price of 40%. Overhead expenses are 30% of cost on average. What is the operating profit on a suit that sells for $495?

Accepted Answer

The answer of Prestige Clothiers' regular prices for menswear are...

Question 8

M studios received an invoice for photography equipment for $500 dated May 5, with terms 2/10, n/30. What payment will settle the invoice on:
a) May 15?
b) May 16?

Accepted Answer

The answer of M studios received an invoice for photography...

Question 9

Village Foods employs a 35% rate of mark-up on cost of all dairy products. The store's overhead averages out to 20% of sales each month. What is the operating profit on a 4-litre pail of ice cream for which the wholesale cost is $4.65?

Accepted Answer

The answer of Village Foods employs a 35% rate of...

Question 10

A wholesaler offers discounts of 10%, 8%, and 5%. What is the single equivalent discount rate?

Accepted Answer

The answer of A wholesaler offers discounts of 10%, 8%,...

Question 11

If a grocery store's rate of mark-up on selling price of tomatoes is 55%, what is the rate of mark-up on cost of the tomatoes?

Accepted Answer

The answer of If a grocery store's rate of mark-up...

Question 12

A pharmacy marked up its sunscreen to provide for overhead expenses of 40% of cost and a profit of 45% of cost. At the end of the summer, what rate of markdown can the pharmacy apply to the remaining inventory of sunscreen and still break even on sales at the reduced price?

Accepted Answer

The answer of A pharmacy marked up its sunscreen to...

Question 13

An invoice dated March 15 for $400 with terms 2/10, 1/20, ROG, was received on March 20. The goods were delivered on April 28. By what date should the invoice be paid to qualify for the 2% discount?

Accepted Answer

The answer of An invoice dated March 15 for $400...

Question 14

Larissa sells coats for $200 less 30%. Kristina sells coats for $196 less 25% and 5%. What second discount would Larissa need to offer to match Kristina's net price?

Accepted Answer

The answer of Larissa sells coats for $200 less 30%....

Question 15

Workwear Station uses a mark-up on cost of 60% to establish its retail prices. This pricing rule builds in a profit of 25% of cost. What rate of markdown can Workwear Station offer and just break even on the reduced price?

Accepted Answer

The answer of Workwear Station uses a mark-up on cost...

Question 16

Ski 'n Cycle purchased Elan 200 skis for $492 per pair and priced them to give a rate of mark-up on selling price of 40%. When this model was discontinued, the store marked down its remaining stock by 30%. What was the sale price after the markdown?

Accepted Answer

The answer of Ski 'n Cycle purchased Elan 200 skis...

Question 17

A snow blower retails for $489. The dealer's overhead is 20% of cost, and normal operating profit is 16 $\frac{2}{3}$ % of cost.
a) What is the largest amount of markdown that will allow the dealer to break even?
b) What rate of markdown will price the snow blower at cost?

Accepted Answer

The answer of A snow blower retails for $489. The...

Question 18

The rate of mark-up on cost of fresh peaches in a grocery store is 125% because of the large losses from spoilage and bruising while the peaches are in storage and on display. What is the rate of mark-up on selling price?

Accepted Answer

The answer of The rate of mark-up on cost of...

Question 19

Sunrise Building Supply obtains 4- by 8-ft sheets of wallboard from Canadian Gypsum at $30 per sheet less 30% and 10%. The price is to be set to cover Sunrise's overhead of 20% of the selling price and to provide an operating profit of 18% of the selling price. What should be the retail price per sheet?

Accepted Answer

The answer of Sunrise Building Supply obtains 4- by 8-ft...

Question 20

A manufacturer of snowmobiles sells through distributors in some regions of the country, through wholesalers in other regions, and directly to retailers in its home province. The manufacturer gives a 25% trade discount to retailers, an additional 10% discount to wholesalers, and a further 7.5% discount to distributors. What net price does the manufacturer receive from each buying level on a snowmobile listed at $9,800?

Accepted Answer

The answer of A manufacturer of snowmobiles sells through distributors...

Quiz 4: Mathematics of Merchandising

The list price of a coat is $125.00. A retailer is able to purchase the coat for $106.25. What is the rate of trade discount?