Deck 4: Mathematics of Merchandising

Question 1

Calculate the missing values:

Answer 1

$83.00 and $166.00

Question 2

Calculate the missing values:

Answer 2

$165.83 and $829.17

Question 3

Calculate the missing values:

Answer 3

Question 4

Calculate the missing values:

Question 5

Calculate the missing values:

Question 6

Calculate the missing values:

Question 7

Calculate the missing values:

Question 8

Calculate the missing values:

Question 9

Calculate the missing values:

Question 10

Calculate the missing values:

Question 11

Calculate the missing values:

Question 12

Calculate the missing values:

Question 13

Calculate the missing values:

Question 14

After a trade discount of 27.5%, a jeweller can obtain 0.50 carat (Empress Cut, F Colour) Canadian Polar Bear diamonds for $2138.75. What is the dollar amount of the trade discount?

Question 15

The net proceeds to the vendor of a house after payment of a 5.5% real estate commission were $321,111. At what price did the house sell?

Question 16

At its current price of $0.80 per share, the price of Golden Egg Resources stock is down 73% from its price one year ago. What was that price?

Question 17

An invoice for $2365, dated September 25, has terms of payment 2/20, n/30. What amount on October 5 will pay the invoice in full?

Question 18

The terms of payment on a $2365 invoice dated October 25 were 1½ /15, n/45. What amount will settle the invoice on November 10?

Question 19

On June 29, Josef received an invoice for $815.49, dated June 27. If the terms of the invoice are 2/10, 1/ 20, n60, what amount is required on July 7 to pay the invoice in full?

Question 20

On March 26, Silke received an invoice in the amount of $5445, dated March 23, with terms 3/10, 1½ /20, n/60. What payment on April 13 will settle the invoice?

Question 21

. White's Photography received an e-invoice from Fuji Canada dated February 27 of a leap year. The amount of the invoice is $2896.77 with terms , 1/30, n/60.
a) What is the last date on which White's is eligible for the 2 % discount?
b) What amount will be required on that date to settle the invoice?
c) Instead of the payment in (b), what amount must be paid on March 29 to settle the invoice?

Question 22

An invoice for $2365.00 has terms 2/10, n30. The amount credited on a payment made within the discount period was $1365.00. What was the amount of the payment?

Question 23

The terms of payment on an invoice for $2835.49 are 2/15, n45. The balance owed after a payment within the discount period is $1135.49. What was the amount of the payment?

Question 24

On June 3, Josh made a payment of $500 on an invoice for $1283.50, dated May 25. The terms of payment were 3/10, n30. What amount was credited to Josh's account?

Question 25

An invoice for $3868, dated June 26, had terms 2/10, 1/20, n45. What amount was credited for:
a. A payment of $1000 on July 5?
b. A payment of $1000 on July 16?
c. A payment of $1000 on August 10?

Question 26

Mayfair Distributors sent Bed 'n Bath an invoice dated December 23 for $5344.90 with terms 2/10, 1/20, n/30. The penalty on overdue accounts is 1 % of the overdue balance.
a) What is the balance after a payment of $3000 on January 3?
b) What additional payment on January 30 will settle the account?

Question 27

Payments of $1000 on January 5 and $800 on January 16 were made on a $2500 invoice dated December 27. The terms on the invoice were 4/10, 2/20, n/45. What was the balance owed after the second payment?

Question 28

On March 25, Hannah received an invoice in the mail from Carpet Country for $4235. The invoiced was dated March 22 and had terms 3/15, 1½ /30, n/60. If she made payments of $1000 on each of April 2, April 9, and April 22, how much did Hannah still owe?

Question 29

Ristorante Italiano made payments of $5000 on March 29 and $3000 on April 7 to General Restaurant Supplies on an invoice for $11,870. The invoice was dated March 21 and carried terms of 1/10/20, n/30.
a) What is the balance after the second payment?
b) On what date is the balance due?

Question 30

A payment of $3000 on a $6000 invoice qualified for the larger cash discount in 3/10, 1/20, n30. What additional payment 18 days after the invoice date will settle the invoice?

Question 31

Jake received an invoice for $2500 with terms 5/10, 2/30, n60. After one payment within the 10-day discount period, a second payment of $1057.37 within the 30-day discount period paid off the balance. What was the amount of the first payment?

Question 32

For a given dollar amount of markup, which will be the larger number: the rate of markup on cost or the rate of markup on selling price? Explain.

Question 33

An item that costs a store $152.50 is marked up by $47.45. Determine: a. The rate of markup on cost b. The rate of markup on selling price

Question 34

A retailer obtains a product at a unit cost of $51.30 and sells it for $79.90. Determine: a. The rate of markup on cost b. The rate of markup on selling price

Question 35

Unit operating expenses for an item costing $30 are estimated at 40% of cost, and the desired operating profit is 25% of cost. Determine:
a. The selling price
b. The rate of markup on cost
c. The rate of markup on selling price

Question 36

A retailer prices her goods to cover operating expenses at 30% of cost and to generate a profit of 20% of cost. For an item she buys from her wholesaler at $49, determine:
a. Its selling price
b. The rate of markup on cost
c. The rate of markup on selling price

Question 37

A merchant prices his inventory to allow for operating expenses at 30% of selling price and an operating profit of 20% of selling price. If an item is priced at $49.95, determine:
a. The rate of markup on selling price
b. Its cost
c. The rate of markup on cost

Question 38

The price structure in a store is such that, for every $100 of sales, $40 is the cost the goods sold and $45 goes to overhead costs. For an item with a wholesale cost of $119, determine
a. It's selling price
b. The rate of markup on cost
c. The rate of markup on selling price
d. The operating profit on the item

Question 39

A men's clothing store marks up suits by 75% of cost. This provides an operating profit of 15% of the selling price. If a suit's cost to the store is $132, determine
a. It's selling price
b. The rate of markup on selling price
c. The operating profit

Question 40

A grocery store prices fresh produce at twice its cost to the store. Determine:
a. The rate of markup on cost
b. The rate of markup on selling price

Question 41

The markup on greeting cards in a drug store is 65% of the selling price. For a card priced at $4.95, determine:
a. It's cost
b. The rate of markup on cost

Question 42

The markup on desserts in a restaurant is 70% of the menu price. The restaurant is adding key lime pie to its dessert list. The cost to the restaurant works out to $1.25 per slice. Determine:
The menu price of the pie b. The rate of markup on cost

Question 43

Bath 'n Bedroom sets its prices to allow for overhead expenses that average 50% of unit cost and a normal profit of 30% of cost. For towel sets priced at $39.89, determine:
a. The wholesale cost
b. The rate of markup on selling price

Question 44

The price of tools is set by Ace Hardware to cover operating expenses at 40% of cost, and to generate an operating profit of 25% of cost. What is the rate of markup on selling price for a rotary saw selling for $129?

Question 45

Maritime Cellular purchases a BlackBerry smart-phone model for $395 less trade discounts of 20% and 10%. Maritime's overhead expenses are $59 per unit.
a) What should be the selling price to generate a profit of $40 per phone?
b) What is the rate of markup on cost?
c) What is the rate of markup on selling price?
d) What would be the break-even selling price for the Annual Clear-Out Sale?

Question 46

The rate of markup on the cost of a toaster selling at $54.95 is 45%.
a) What was the cost of the toaster to the retailer?
b) What is the rate of markup on selling price?

Question 47

Beaver Building Supply obtains 4- by 8-ft sheets of half-inch plywood from Macmillan Forest Products at $54 per sheet less 30% and 5%. The price is to be set to cover Beaver's overhead of 20% of the selling price and to provide an operating profit of 12% of the selling price. What should be the retail price per sheet?

Question 48

An item costing $185 was marked up by 50% of cost and subsequently marked down by $60 during a sale. Determine:
a. The regular selling price
b. The rate of markdown

Question 49

An item was marked up from $58.50 to $95.00, then later marked down by 30% during a Spring Sale. Determine:
a. The original rate of markup on selling price
b. The price during the Spring Sale

Question 50

An item was marked up from $24.99 to $49.98 before it was marked down to $24.99 and sold at cost. Determine:
a. The rate of markup on cost
b. The rate of markdown

Question 51

The manager of a home and garden store buys patio furniture sets for $580 each and marks them up by 50% of cost. In late August, he clears out remaining inventory at a 30% markdown. Determine:
a. The clearance price
b. The rate of markdown (from the regular price) to sell the floor display set at cost

Question 52

Calculate the reduced price, if an item costing $19.25 is marked up by 35% of the selling price and then marked down by 25%.

Question 53

Garden Centre purchases lawnmowers from a wholesaler for $249 and marks them up by 25% of selling price. At the end of the summer, a scratched floor-display mower's price is reduced to 10% above cost. What percentage price reduction should the price tag show?

Question 54

Digital Devices plans to stop carrying the Casio FC-100 calculator. It normally marks up the calculator from the $71.50 wholesale cost to the regular selling price of $99.95.
a) What is the normal rate of markup on selling price?
b) What rate of markdown can be advertised if Digital Devices wishes to clear out the stock at the wholesale cost?

Question 55

Poles Apart obtains Nitro T1 snowboards at a cost of $345 and marks them up by 35% of the selling price. For its Annual Spring Sale, Poles Apart marks down prices by 25%. What is the sale price of the Nitro T1 snowboards?

Question 56

The sign on a rack of sport coats reads: "All prices already marked down 30%!" What is the regular selling price of a coat marked at:
a) $100?
b) $196.49?

Question 57

An item that cost $37.25 was marked up by 60% of cost. Later, the retail price was reduced to $41.72. If unit overhead expenses were 20% of cost, what was the unit operating profit at the reduced price?

Question 58

A retailer marked up an item from its $7.92 cost to the regular selling price of $19.80. During the store's Anniversary Sale, the item was offered at 20% off. On a sale at this price, what was the (reduced) operating profit if unit overhead expenses were 70% of cost?

Question 59

Elite Sports sells Kevlar-graphite shaft hockey sticks for $147 each. Elite's wholesale cost is $98. For the Spring Clearance Sale, the prices are marked down by 20%. If overhead expenses are 15% of the regular selling price, what is the unit operating profit at the sale price?

Question 60

Morgan Photography's markup on its antique picture frames is 35% of selling price. Its cost on the medium-size antique frame is $115.70. For portrait photos shot by Morgan's, this frame's price is reduced to $133.50. What is Morgan's operating profit or loss at this price if overhead expenses are 20% of the regular selling price?

Question 61

.In February, Long Lake Nursery ordered lawn fertilizer at $18.60 less 33 %, 12 %, and 5% per 20-kg bag. The fertilizer is normally priced to provide a 55% rate of markup on selling price. Operating (overhead) expenses are 30% of cost. To clear out the remaining bags of fertilizer in July, they were marked down by 45%. Calculate:
a) The net cost per bag.
b) The operating expenses per bag.
c) The regular selling price.
d) The sale price (reduced selling price).
e) The reduced markup at the sale price.
f) The operating profit or loss at the sale price.
g) The rate of markup on the sale price.

Question 62

Water Sports Ltd. pays $360 less 25% for a backyard above-ground pool kit. Overhead expenses are 16 % of the regular selling price, and the operating profit is 15% of the selling price.
a) What is the maximum rate of markdown the store can offer and still break even?
b) What is the profit or loss per unit if Water Sports clears out its remaining stock at 20% off in a Hot August Bargains sale?

Question 63

A lawn mower retails for $349. The dealer's overhead is 25% of cost, and normal operating profit is 16
% 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 lawn mower at cost?

Question 64

United Furniture buys reclining rocking chairs at $550 less 40% and 10%. The price is marked up to allow for overhead of 50% of cost and profit of 35% of cost. The unit on display in the store acquired a stain. What rate of markdown from the regular price can the store offer if it is to recover only half of the unit overhead costs?

Question 65

Fashion Master purchased men's sweaters for $72 less 40% and 15%. The normal rate of markup on selling price is 40%, and overhead is 25% of the selling price. The sweaters were reduced to $45.90 for the store's Boxing Day Blowout.
a) What was the rate of markdown for the sale?
b) What was the profit or loss on each sweater at the sale price?
c) At the sale price, what was the rate of markup on cost?

Question 66

Mr. Vacuum obtains vacuum cleaners for $720 less 33 % and 15%. A demonstration unit regularly priced at $750 was sold for $450. The shop's overhead is 12% of the regular selling price.
a) What was the markdown rate on the vacuum cleaner?
b) What was the profit or loss on the sale of the demonstrator?
c) What rate of markup on cost was realized at the reduced price?

Question 67

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

Question 68

Sonic Boom obtained a stereo system for $2400 less 30% and 15%. The system was originally priced so that, when sold in a "20% off" sale, the store's overhead and operating profit represent 25% and 15%, respectively, of the sale price. In a Midnight Madness Special, the system was sold at a " off" special price.
a) What was the original "regular price"?
b) What was the profit or loss at the special price?

Question 69

Furniture Warehouse bought upright freezers for $1800 less 33 % and 5%. The store's overhead works
out to 30% of cost. The freezers are initially priced so that a profit of 16⅔% of cost will be realized when a freezer is sold at a "15% off"price.
a) What is the initial full rate of markup on cost?
b) During its Scratch-and-Save sale, customers qualify for an extra discount of either 5%, 7%, or 10%. This extra discount appears when the customer scratches a ticket at the time of a purchase. It is added to the basic 15% discount, making the combined discount 20%, 22%, or 25%, respectively. What is the store's profit or loss per freezer at each of these discounts?

Question 70

Specialty Builders Supply has two sources for the same power saw. Source A sells the saw at $196.00 less 20%, and Source B offers it at $186.60 less 16 %. Which source is less expensive?

Question 71

In addition to the regular trade discount of 25% and a volume purchase discount of 8 % from the manufacturer, Appliance Warehouse is offered a further 5% discount for orders placed in January.
a) What is the net price after all three discounts on refrigerators listed at $1195?
b) What is the list price on an electric range whose net price works out to be $470.25?
c) What single trade discount is equivalent to the three trade discounts?
d) After the regular and volume discounts are both taken, what dollar amount of savings does the extra discount for January orders represent on a $1000 list price item?

Question 72

The Pro Shop at Sunny Lake Golf and Country Club prices its golf club sets to allow for overhead of 33
% 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?

Question 73

Bosley's Pet Foods buys dog kibble for $19.50 per bag less 40%. The store's overhead is 33 % of the selling price, and the desired profit is 10% of the selling price.
a) At what price per bag should the dog food be sold?
b) At this price, what is the rate of markup on cost?
c) What is the break-even price?

Question 74

Central Ski and Cycle purchased 50 pairs of ski boots for $360 per pair less 33 % and 10%. The regular rate of markup on selling price on the boots is 40%. The store's overhead is 22% of the selling price. During a January clearance sale, the price was reduced to $270 per pair.
a) What was the rate of markdown for the sale?
b) What was the profit or loss on each pair of boots at the sale price?
c) At the sale price, what was the rate of markup on cost?

Question 75

A snowblower retails for $489. The dealer's overhead is 20% of cost, and normal operating profit is 16
% 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 snowblower at cost?

Question 76

Determine the payment required to settle the invoice on the indicated payment date.

Question 77

Determine the payment required to settle the invoice on the indicated payment date.

Question 78

Determine the payment required to settle the invoice on the indicated payment date.

Question 79

Determine the payment required to settle the invoice on the indicated payment date.

Question 80

An invoice for $2365 was dated February 25 and had terms of payment 1½ /10, EOM. A payment on March 9 resulted in a credit to the account of $1421.32. What was the amount of the payment?