Question 1

Contribution margin is selling price plus unit cost.

Accepted Answer

A) True 
 B)False

Question 2

Mr. Small, the store manager for Jay's Appliance, is having a difficult time placing a selling price on a refrigerator that cost $410. Mr. Small knows his boss would like to have a 45% markup based on cost. The selling price should be:

Accepted Answer

A) $745.45 
B) $754.54 
C) $594.50 
D) $549.50 
E) None of these 
A) $745.45 
B) $754.54 
C) $594.50 
D) $549.50 
E) None of these

Question 3

A wooden duck with a regular selling price of $125.99 is marked down to $79.99. The percent of markdown is:

Accepted Answer

A) 57.51% 
B) 36.51% 
C) 35.61% 
D) 55.71% 
E) None of these 
A) 57.51% 
B) 36.51% 
C) 35.61% 
D) 55.71% 
E) None of these

Question 4

Percent markup on selling price can be converted to percent markup on cost by formula.

Accepted Answer

A) True 
 B)False

Question 5

A final selling price may be the result of a series of markdowns (and possibly some markups).

Accepted Answer

A) True 
 B)False

Question 6

Setting a price on perishable items does not include:

Accepted Answer

A) Calculating total cost 
B) Calculating total selling price 
C) Calculating a selling price per day 
D) Calculating a selling price per pound 
E) None of these 
A) Calculating total cost 
B) Calculating total selling price 
C) Calculating a selling price per day 
D) Calculating a selling price per pound 
E) None of these

Question 7

If percent markup on cost and selling price are known, one is able to compute the:

Accepted Answer

A) Amount of markdown 
B) Amount of spoilage 
C) Cost 
D) Selling price at wholesale 
E) None of these 
A) Amount of markdown 
B) Amount of spoilage 
C) Cost 
D) Selling price at wholesale 
E) None of these

Question 8

Net income is calculated as:

Accepted Answer

A) Net sales + costs - operating expenses 
B) Net sales - costs - operating expenses 
C) Net sales + costs + operating expenses 
D) Net sales - costs + operating expenses 
E) None of these 
A) Net sales + costs - operating expenses 
B) Net sales - costs - operating expenses 
C) Net sales + costs + operating expenses 
D) Net sales - costs + operating expenses 
E) None of these

Question 9

Calculate the final selling price to the nearest cent (round each calculation to nearest cent as needed):

Accepted Answer

$4,495.59
6000 x .91

Question 10

Dollar markdowns represent price increases to the original selling price.

Accepted Answer

A) True 
 B)False

Question 11

An Apple iPod sells for $299, which is marked up 40% of the selling price. The cost of the iPod is:

Accepted Answer

A) $197.40 
B) 179.40 
C) 149.70 
D) 194.70 
E) None of these 
A) $197.40 
B) 179.40 
C) 149.70 
D) 194.70 
E) None of these

Question 12

Gap sells jeans that cost $21.00 for a selling price of $29.95. The percent of markup based on cost is:

Accepted Answer

A) 42.62% 
B) 46.26% 
C) 49.88% 
D) 48.9% 
E) None of these 
A) 42.62% 
B) 46.26% 
C) 49.88% 
D) 48.9% 
E) None of these

Question 13

A toaster is marked up $10 and sells for $45.00. Find the cost and percent markup if the markup is based on cost. (Round to the nearest hundredth percent.)

Accepted Answer

The answer of A toaster is marked up $10 and...

Question 14

The markdown percent is calculated by:

Accepted Answer

A) Amount of markdown divided by sale price 
B) Amount of markdown divided by original selling price 
C) Sale price divided by amount of markdown 
D) Original selling price divided by amount of markdown 
E) None of these 
A) Amount of markdown divided by sale price 
B) Amount of markdown divided by original selling price 
C) Sale price divided by amount of markdown 
D) Original selling price divided by amount of markdown 
E) None of these

Question 15

Actual cost is equal to the cost times the markup percent on cost plus 1.

Accepted Answer

A) True 
 B)False

Question 16

Fathers' Day suits were advertised for 35% off the regular price. A suit regularly sells for $210. The amount of the markdown is:

Accepted Answer

A) $37.50 
B) $136.50 
C) $73.50 
D) $163.50 
E) None of these 
A) $37.50 
B) $136.50 
C) $73.50 
D) $163.50 
E) None of these

Question 17

A video game sells at Arnolds for $14.99. Arnolds marks the game up at 40% of the selling price. The cost of the video game to Arnold is:

Accepted Answer

A) $6.00 
B) $8.99 
C) $6.50 
D) $9.10 
E) None of these 
A) $6.00 
B) $8.99 
C) $6.50 
D) $9.10 
E) None of these

Question 18

Red Jeans Inc. sells jeans that cost $16.55 for a selling price of $35.99. The percent of markup based on cost is:

Accepted Answer

A) 17.46% 
B) 94.44% 
C) 4.02% 
D) 7.07% 
E) None of these 
A) 17.46% 
B) 94.44% 
C) 4.02% 
D) 7.07% 
E) None of these

Question 19

Blue Jeans, Inc., sells jeans that cost $15.99 for a selling price of $42.95. What is the percent of markup based on cost? (Round to the nearest hundredth percent.)

Accepted Answer

The answer of Blue Jeans, Inc., sells jeans that cost...

Question 20

A local True Value Hardware Store marks its goods up 38% on cost. If a snow blower cost True Value $400, the selling price would be:

Accepted Answer

A) $525.00 
B) 552.00 
C) 542.00 
D) 452.00 
E) None of these 
A) $525.00 
B) 552.00 
C) 542.00 
D) 452.00 
E) None of these

Exam 8: Markups and Markdowns: Perishables and Breakeven Analysis

Contribution margin is selling price plus unit cost.

Mr. Small, the store manager for Jay's Appliance, is having a difficult time placing a selling price on a refrigerator that cost $410. Mr. Small knows his boss would like to have a 45% markup based on cost. The selling price should be:

A wooden duck with a regular selling price of $125.99 is marked down to $79.99. The percent of markdown is:

Percent markup on selling price can be converted to percent markup on cost by formula.

A final selling price may be the result of a series of markdowns (and possibly some markups).

Setting a price on perishable items does not include:

If percent markup on cost and selling price are known, one is able to compute the:

Net income is calculated as:

Calculate the final selling price to the nearest cent (round each calculation to nearest cent as needed):

Dollar markdowns represent price increases to the original selling price.

An Apple iPod sells for $299, which is marked up 40% of the selling price. The cost of the iPod is:

Gap sells jeans that cost $21.00 for a selling price of $29.95. The percent of markup based on cost is:

A toaster is marked up $10 and sells for $45.00. Find the cost and percent markup if the markup is based on cost. (Round to the nearest hundredth percent.)

The markdown percent is calculated by:

Actual cost is equal to the cost times the markup percent on cost plus 1.

Fathers' Day suits were advertised for 35% off the regular price. A suit regularly sells for $210. The amount of the markdown is:

A video game sells at Arnolds for $14.99. Arnolds marks the game up at 40% of the selling price. The cost of the video game to Arnold is:

Red Jeans Inc. sells jeans that cost $16.55 for a selling price of $35.99. The percent of markup based on cost is:

Blue Jeans, Inc., sells jeans that cost $15.99 for a selling price of $42.95. What is the percent of markup based on cost? (Round to the nearest hundredth percent.)

A local True Value Hardware Store marks its goods up 38% on cost. If a snow blower cost True Value $400, the selling price would be:

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