Question 1

Under what unusual circumstances will the rate of mark-up on cost equal the rate of mark-up on selling price?

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Question 2

A clothing store orders a line of jeans at a suggested retail price of $58 less trade discounts of 30% and 7%. The manager intends to sell the jeans at the suggested retail price. If overhead expenses are 25% of the selling price:
a) What will be the operating profit on each pair of jeans?
b) What is the rate of mark-up on cost?
c) What is the rate of mark-up on selling price?
d) What would be the break-even selling price for an inventory clearance sale?

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Question 3

A discount furniture store bought a bed at the wholesale price of $665. The "regular price" of the bed is set so that, in a "20% off" sale, the rate of mark-up on selling price is 30%.
a) What is the price of the bed in a "20% off" sale?
b) What is the "regular price" of the bed?

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Question 4

An item sells for $85. The cost of the item is $50 and overhead expenses are estimated to be 25% of the selling price. What is the rate of mark-up on selling price of the item?

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Question 5

A jewellery store purchased a diamond ring for $2,500 less 40% and 5%. The "regular price" of the ring is established so that, if it is sold in a "20% off" sale, overhead expenses amounting to 20% of the sale price and unit operating profit amounting to 12.5% of the sale price will be covered.
a) What is the reduced price of the ring in a "20% off" sale?
b) What is the "regular price" of the ring?

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The answer of A jewellery store purchased a diamond ring...

Question 6

London Drugs purchases digital cameras for $850 less 32% and 6%. Mark-up on cost is 38% and on average operating expenses are 18% of selling price. Determine the profit or loss realized per camera if they are put on sale for $662.34.

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Question 7

Cliff sells memberships at his karate club for $500 per year. His nearest competitor is offering a special price during the last two weeks of December of $425 per year. What rate of markdown will Cliff have to offer to match his competitor's price?

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Question 8

Hi-Lites Inc. purchased a ceiling light fixture for $480 less 40% and 25%. The fixture was then marked up by 120% of cost. Overhead expenses are 55% of cost. In a clearance sale, Hi-Lites offered the fixture at 40% off. Determine:
a) The net cost of the fixture.
b) The amount of the mark-up.
c) The overhead expenses per fixture.
d) The regular selling price.
e) The sale price (reduced selling price).
f) The rate of mark-up on cost at the sale price.
g) The operating profit or loss at the sale price.

Accepted Answer

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Question 9

A bedroom suite costs Town & Country Furniture $2,500 less 30% and 15%. The normal rate of mark-up on cost is 90%. The suite is marked down 30% in a Mid-Summer sale. What is the sale price?

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The answer of A bedroom suite costs Town & Country...

Question 10

Mining equipment was purchased at a wholesale price of $$1,365 less 35% and 5%. The retail price is based on a 31% mark-up on cost. The retailer's operating expenses is approximately 10% of the selling price. Determine the profit or loss realized if the product is put on sale for $$938.56.

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Question 11

M Studios sells a camera lens for $300. During their annual August sale, the camera lens is reduced by 15%. What is the sale price?

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Question 12

Does a retailer break even if an item is sold at the cost, C?

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Question 13

A product has a wholesale price of $876 less 27% and 8%. Mark-up on cost is 29%, while operating expenses are 16% of selling price. If the retailer sells the product for $645.09, determine the rate of mark-up realized.

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The answer of A product has a wholesale price of...

Question 14

The rate of mark-up on cost on a line of cosmetics is 85%. If the mark-up on an eye shadow kit is $14:
a) What is the retail selling price of the kit?
b) What is the rate of mark-up on selling price?

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

Question 15

After all discounts, the net cost of a product was $399.43. The regular retail price of the product was $495.29. Operating expenses associated with the product were $39.94. If the product was sold to actually realize a 5.40% mark-up, then determine the discounted retail price.

Accepted Answer

The answer of After all discounts, the net cost of...

Question 16

a) Merchant A operates on a rate of mark-up on cost of 45%. If she later marks the price of a few items down to their cost price in order to attract additional customers to the store, what rate of markdown can she advertise?
b) Merchant B operates on a rate of mark-up on selling price of 45%. If he later marks the price of a few items down to their cost price in order to attract additional customers to the store, what rate of markdown can he advertise?

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The answer of a) Merchant A operates on a rate...

Question 17

After all discounts, the net cost of a product was $690.68. The regular retail price of the product was $946.23. Operating expenses associated with the product were $124.32. If the product was sold to actually realize a 16.45% mark-up, then determine the discounted retail price.

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Question 18

Future Shop purchases computers for $787 less 31% and 6%. The normal retail price is 37% of cost. Determine the normal retail price

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Question 19

An item costing $50 was marked up 40% of the cost price and then reduced for a quick sale by 40% of the selling price. What was the sale price?

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Question 20

What is the profit on a unit, which costs $21.60 and sells for $49.95, when operating expenses are expected to be 25% of cost?

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Quiz 4: Mathematics of Merchandising