Question 1

A computer sells for $995, which is marked up 35% of the selling price. The cost of the computer is:

Accepted Answer

A) $1,343.25 
B) $1,433.52 
C) $1,350.77 
D) $1,530.77 
E) None of these

Question 2

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

Accepted Answer

A) $197.04 
B) $179.04 
C) $104.65 
D) $179.40 
E) None of these

Question 3

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

Accepted Answer

A) True 
 B)False

Question 4

Contribution margin is:

Accepted Answer

A) Net sales 
B) Revenues plus variable cost 
C) Revenues minus variable cost 
D) Revenues divided by fixed cost 
E) None of these

Question 5

Selling price $700
Markup % on cost 30%
Actual cost?

Accepted Answer

The answer of Selling price $700
Markup % on cost 30%
Actual...

Question 6

Calculate the dollar markup and cost.
 $$\begin{array} { | c | c | c | c | } 
\hline \text { Selling Price } & \begin{array} { c } 
\% \text { Markup on } \
\text { Selling Price }
\end{array} & \begin{array} { c } 
\text { Dollar } \
\text { Markup }
\end{array} & \text { Cost } \
\hline \$ 800 & 25 \% & \text { A } & \text { B } \
\hline
\end{array}$$

Accepted Answer

The answer of Calculate the dollar markup and cost.
 \[\begin{array}...

Question 7

Match the following terms with their definitions.
-Overhead

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

Question 8

Breck Hardware purchased from Black & Decker 10 Dustbusters for $24.95 each. What should Breck charge its customers for each Dustbuster if it has a 39.5% markup on cost? (Round to the nearest cent.)

Accepted Answer

The answer of Breck Hardware purchased from Black & Decker...

Question 9

Lucy's Bakeshop makes cupcakes that cost $.95 each. Lucy knows that 20% of the cupcakes will spoil. Assume Lucy wants a 35% markup on cost and produces 60 cupcakes. What should Lucy charge for each cupcake? Round to the nearest cent.

Accepted Answer

The answer of Lucy's Bakeshop makes cupcakes that cost $.95...

Question 10

Mary's Bakeshop makes triple chocolate brownies that cost $1.50 each. Past experience shows that 20% of the brownies will spoil. Assuming Mary wants a 40% markup based on cost and produces 200 brownies, what should each brownie sell for?

Accepted Answer

The answer of Mary's Bakeshop makes triple chocolate brownies that...

Question 11

Find the cost and markup of a stove if it sells for $400 and is marked up 100% of the cost.

Accepted Answer

The answer of Find the cost and markup of a...

Question 12

26% Markup on Selling Price
Actual Cost = $700
Selling Price = ?

Accepted Answer

The answer of 26% Markup on Selling Price
Actual Cost =...

Question 13

Assume markup is based on cost. Solve for the actual cost (round to nearest cent):
Selling price $600
Markup % on cost 35%
Actual cost?

Accepted Answer

The answer of Assume markup is based on cost. Solve...

Question 14

The selling price can be calculated if the cost and the percent markup on cost are given.

Accepted Answer

A) True 
 B)False

Question 15

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

Question 16

A local Dunkin' Donuts makes blueberry muffins that cost $.69 each. Past experience shows that 15% of the muffins will spoil and have to be discarded. Assuming that this shop wants a 30% markup based on cost and produces 200 muffins, each muffin should sell for:

Accepted Answer

A) $0.90 
B) $0.91 
C) $1.50 
D) $1.06 
E) None of these

Question 17

Match the following terms with their definitions.
-Gross profit

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

Question 18

Calculate the final selling price to the nearest cent (round each calculation to nearest cent as needed):
 $$\begin{array} { | c | c | c | c | c | } 
\hline \begin{array} { c } 
\text { Original } \
\text { Selling Price }
\end{array} & 1 \text { st Markdown } & \begin{array} { c } 
2 \text { nd } \
\text { Markdown }
\end{array} & \text { Markup } & \begin{array} { c } 
\text { Final } \
\text { Markdown }
\end{array} \
\hline \$ 6,000 & 9 \% & 13 \% & 4 \% & 9 \% \
\hline
\end{array}$$

Accepted Answer

The answer of Calculate the final selling price to the...

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 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

Exam 8: Markups and Markdowns: Perishables and Breakeven Analysis