Exam 8: Markups and Markdowns: Perishables and Breakeven Analysis

Ski Market sells snowboards. Ski Market knows that the most people will pay for the snowboards is $129.99. Ski Market is convinced that it needs a 45% markup based on cost. The most that Ski Market can pay to its supplier for the snowboards is:

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

Net income is calculated as:

Selling price times 1 minus markup percent on selling price will equal the cost if markup is based on selling price.

Jay King, owner of a local Bed and Bath store, knows that his customers will pay at most $299 for a blow-up bed. Assuming Jay wants a 40% markup on the selling price, the most he could pay the manufacturer for the blow-up bed is:

When markup is based on cost:

A local Dot Dress Shop is selling a suit for $99. Because of changing styles, the first markdown was 8% and second markdown was 25%. The suit still did not sell, so a final markdown of 10% was taken. The sale price is currently:

28% markup on selling price Actual cost $900 Selling price?

Johnny Mac's Sporting Goods bought a baseball glove from Rawlings Sporting Goods for $66.00. They want to markup the glove 70% on selling price. What should Johnny's sell the glove for?

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

To place a price on perishable items, there is no need to calculate the total cost as well as total selling price of the items.

26% markup on selling price Actual cost $700 Selling price?

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

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

Dollar markup divided by the selling price equals percent markup on cost.

When markup is based on selling price, the cost is 100%.

Macy's Department Stores markup men's cologne 63% on cost for an 8-ounce bottle. A bottle of cologne costs Macy's $23.00. What is the selling price for the 8-ounce bottle?

Setting a price on perishable items does not include:

Belle's Bake Shop makes croissants that cost $1.75 each. Past experience shows that 10% of the croissants will spoil and have to be discarded. Assuming Belle wants a 45% markup based on cost and produces 300 croissants, each croissant should sell for:

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