5.3 markup

# 5.3 markup - 5.3 Markup MARKUP FORMULAS MARKUP:The amount...

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5.3 Markup

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MARKUP: The amount added to the unit cost of an item to arrive at it’s selling price. Also referred to as gross profit . Selling Price = Cost + Markup S = C + M MARKUP FORMULAS Markup = Expenses (Overhead) + Profit M = E + P S = C + E + P
Freddy’s cycle shop is adding a new line of bikes to their inventory. Freddy’s can purchase the bikes at a cost of \$385. If operating expenses are 35% of cost, and they would like to make a unit profit of \$129.25, what should Freddy’s sell the bikes for? C = 385 E = 385(0.35) = 134.75 P = 129.25 S = ? S = C + E + P = 385 + 134.75 + 129.25 = \$649

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25% 25% 25% 25% A. \$1,023 B. \$2,883 C. \$1,860 D. \$2,697 Coastal Marine is importing a new line of inflatable boats at a unit cost of \$1,860. Coastal estimates that operating expenses per unit will be 30% of cost and unit operating profit is 25% of cost. a) Based on Coastal’s estimates calculate the markup.
C = 1,860 E = 1,860(0.30) = 558 P = 1,860(0.25) = 465 M = ? M = E + P

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5.3 markup - 5.3 Markup MARKUP FORMULAS MARKUP:The amount...

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