Question 1

Match the following terms with their definitions.
-Contribution margin

Accepted Answer

A) No profit, no loss 
B) Regular expenses of doing business 
C) Dollar profit 
D) Goods or services with a limited life 
E) Price reductions
F)Price paid to supplier
G)Cost is base
H)Selling price is base
I)Original selling price minus current price
J)Selling price minus cost
K)Net sales - cost of goods sold
L)Difference between selling price and variable cost
Difficulty: 1 Easy
Topic: LU 08-01 Markups Based on Cost (100%); LU 08-02 Markups Based on Selling Price (100%); LU 08-03 Markdowns and Perishables; LU 08-04 Breakeven Analysis
Learning Objective: 08-01 (1)Calculate dollar markup and percent markup on cost.; 08-02 (1)Calculate dollar markup and percent markup on selling price.; 08-03 (1)Calculate markdowns; compare markdowns and markups.; 08-03 (2)Price perishable items to cover spoilage loss.; 08-04 (1)Calculate contribution margin.; 08-04 (2)Calculate breakeven point.
Bloom's: Remember
Type: Static
Accessibility: Keyboard Navigation 
A) No profit, no loss 
B) Regular expenses of doing business 
C) Dollar profit 
D) Goods or services with a limited life 
E) Price reductions
F)Price paid to supplier
G)Cost is base
H)Selling price is base
I)Original selling price minus current price
J)Selling price minus cost
K)Net sales - cost of goods sold
L)Difference between selling price and variable cost
Difficulty: 1 Easy
Topic: LU 08-01 Markups Based on Cost (100%); LU 08-02 Markups Based on Selling Price (100%); LU 08-03 Markdowns and Perishables; LU 08-04 Breakeven Analysis
Learning Objective: 08-01 (1)Calculate dollar markup and percent markup on cost.; 08-02 (1)Calculate dollar markup and percent markup on selling price.; 08-03 (1)Calculate markdowns; compare markdowns and markups.; 08-03 (2)Price perishable items to cover spoilage loss.; 08-04 (1)Calculate contribution margin.; 08-04 (2)Calculate breakeven point.
Bloom's: Remember
Type: Static
Accessibility: Keyboard Navigation

Question 2

Match the following terms with their definitions.
-Percent markup on selling price

Accepted Answer

A) No profit, no loss 
B) Regular expenses of doing business 
C) Dollar profit 
D) Goods or services with a limited life 
E) Price reductions
F)Price paid to supplier
G)Cost is base
H)Selling price is base
I)Original selling price minus current price
J)Selling price minus cost
K)Net sales - cost of goods sold
L)Difference between selling price and variable cost
Difficulty: 1 Easy
Topic: LU 08-01 Markups Based on Cost (100%); LU 08-02 Markups Based on Selling Price (100%); LU 08-03 Markdowns and Perishables; LU 08-04 Breakeven Analysis
Learning Objective: 08-01 (1)Calculate dollar markup and percent markup on cost.; 08-02 (1)Calculate dollar markup and percent markup on selling price.; 08-03 (1)Calculate markdowns; compare markdowns and markups.; 08-03 (2)Price perishable items to cover spoilage loss.; 08-04 (1)Calculate contribution margin.; 08-04 (2)Calculate breakeven point.
Bloom's: Remember
Type: Static
Accessibility: Keyboard Navigation 
A) No profit, no loss 
B) Regular expenses of doing business 
C) Dollar profit 
D) Goods or services with a limited life 
E) Price reductions
F)Price paid to supplier
G)Cost is base
H)Selling price is base
I)Original selling price minus current price
J)Selling price minus cost
K)Net sales - cost of goods sold
L)Difference between selling price and variable cost
Difficulty: 1 Easy
Topic: LU 08-01 Markups Based on Cost (100%); LU 08-02 Markups Based on Selling Price (100%); LU 08-03 Markdowns and Perishables; LU 08-04 Breakeven Analysis
Learning Objective: 08-01 (1)Calculate dollar markup and percent markup on cost.; 08-02 (1)Calculate dollar markup and percent markup on selling price.; 08-03 (1)Calculate markdowns; compare markdowns and markups.; 08-03 (2)Price perishable items to cover spoilage loss.; 08-04 (1)Calculate contribution margin.; 08-04 (2)Calculate breakeven point.
Bloom's: Remember
Type: Static
Accessibility: Keyboard Navigation

Question 3

Markdowns may be caused by:

Accepted Answer

A) Lack of seasonal changes 
B) Lack of special promotions 
C) Style changes 
D) Decreased competition 
E) None of these 
A) Lack of seasonal changes 
B) Lack of special promotions 
C) Style changes 
D) Decreased competition 
E) None of these

Question 4

(1 + markup percent on cost)× cost equals:

Accepted Answer

A) Cost at wholesale 
B) Cost at retail 
C) Selling price 
D) Markup 
E) None of these 
A) Cost at wholesale 
B) Cost at retail 
C) Selling price 
D) Markup 
E) None of these

Question 5

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?

Accepted Answer

A) $113.22 
B) $179.82 
C) $246.42 
D) $220.00 
E) None of these 
A) $113.22 
B) $179.82 
C) $246.42 
D) $220.00 
E) None of these

Question 6

Munroe Corporation sells Nautilus equipment for $399.95. Munroe marks up the equipment 30% on the selling price. What did the equipment cost Munroe? Round to the nearest cent.

Accepted Answer

Cost = 399.95 × (1 -

Question 7

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:

Accepted Answer

A) $68.31 
B) $86.31 
C) $61.84 
D) $61.48 
E) None of these 
A) $68.31 
B) $86.31 
C) $61.84 
D) $61.48 
E) None of these

Question 8

Straub's Bakery makes 200 Danish cakes that cost $2.70 each. Straub's needs a 66% markup on cost and normally discards 10% of what it makes. At what price should Straub's sell the Danish cakes?

Accepted Answer

A) $4.48 
B) $4.98 
C) $4.84 
D) $4.89 
E) None of these 
A) $4.48 
B) $4.98 
C) $4.84 
D) $4.89 
E) None of these

Question 9

Operating expenses are the unusual expense of doing business.

Accepted Answer

A) True 
 B)False

Question 10

Al Shelf knows his goods are marked up 36% on cost. If a TV cost Al $280, what would the selling price be?

Accepted Answer

$280 × 1.3

Question 11

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

Question 12

When markup is based on selling price, the cost is the base.

Accepted Answer

A) True 
 B)False

Question 13

Gap sells jeans that cost $21.00 and sell for $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 14

Markup represents an amount needed to cover operating expenses.

Accepted Answer

A) True 
 B)False

Question 15

Pat Maninan, a customer of Brown Co., will pay $400 for a new kitchen table. Brown has a 55% markup on the selling price. What is the most Brown can pay for this kitchen table?

Accepted Answer

Cost = $40

Question 16

Calculate the dollar markup and selling price.
 $$\begin{array} { | c | c | c | c | } 
\hline \text { Cost } & \begin{array} { c } 
\% \text { of Markup } \
\text { on Cost }
\end{array} & \begin{array} { c } 
\text { Dollar } \
\text { Markup }
\end{array} & \text { Selling Price } \
\hline \$ 1,200 & 30 \% & \text { A } & \text { B } \
\hline
\end{array}$$

Accepted Answer

The answer of Calculate the dollar markup and selling price.
...

Question 17

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

Accepted Answer

A) True 
 B)False

Question 18

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 19

Selling price = cost ? markup.

Accepted Answer

A) True 
 B)False

Question 20

Lester Co. produces toy kites. It has a fixed cost of $62,150. If the selling price per unit is $9.50 and the variable cost per unit is $6.25, the breakeven point is:

Accepted Answer

A) $9,207 
B) 6,542 
C) 22,600 
D) 29,860 
E) None of these 
A) $9,207 
B) 6,542 
C) 22,600 
D) 29,860 
E) None of these

Exam 8: Markups and Markdowns: Perishables and Breakeven Analysis

Match the following terms with their definitions. -Contribution margin

Match the following terms with their definitions. -Percent markup on selling price

Markdowns may be caused by:

(1 + markup percent on cost)× cost equals:

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?

Munroe Corporation sells Nautilus equipment for $399.95. Munroe marks up the equipment 30% on the selling price. What did the equipment cost Munroe? Round to the nearest cent.

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:

Straub's Bakery makes 200 Danish cakes that cost $2.70 each. Straub's needs a 66% markup on cost and normally discards 10% of what it makes. At what price should Straub's sell the Danish cakes?

Operating expenses are the unusual expense of doing business.

Al Shelf knows his goods are marked up 36% on cost. If a TV cost Al $280, what would the selling price be?

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:

When markup is based on selling price, the cost is the base.

Gap sells jeans that cost $21.00 and sell for $29.95. The percent of markup based on cost is:

Markup represents an amount needed to cover operating expenses.

Pat Maninan, a customer of Brown Co., will pay $400 for a new kitchen table. Brown has a 55% markup on the selling price. What is the most Brown can pay for this kitchen table?

Calculate the dollar markup and selling price. Cost \% of Markup on Cost Dollar Markup Selling Price \ 1,200 30\% A B

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

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

Selling price = cost ? markup.

Lester Co. produces toy kites. It has a fixed cost of $62,150. If the selling price per unit is $9.50 and the variable cost per unit is $6.25, the breakeven point is:

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