Exam 5: Trade Discount, Cash Discount, Markup, and Markdown

A tire dealer bought tires from a wholesaler at $75.00 dollars each and sold the tires at a mark-up of 25% of cost. a) Calculate the selling price of the tires. b) Calculate the rate of markup based on the selling price.

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Question 1

Correct Answer:

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a) S = 75.00 + 0.25(75.00)
S = 75.00 + 18.75
S = $93.75
b) Rate of markup based on selling price = = 0.2 = 20%

Compute the rate of discount allowed on a cordless drill that lists for $149.99 and is sold for $79.99.

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Question 2

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Amount of discount = 149.99-79.99 = 70.00
Rate of discount = = .466697 = 46.670%

An answering machine cost a dealer $220.00 less 31.5%, 7%. It is regularly priced at $212.00. The dealer's overhead is 17% of the regular selling price and the answering machine was cleared out for $175.45. a) What is the regular markup based on selling price? b) What was the rate of markdown at which the answering machine was sold? c) What was the operating profit or loss? d) What rate of markup based on cost was realized?

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Question 3

Correct Answer:

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a) C = 220(1 - 0.315)(1 - 0.07) = $140.15
M = 212 - 140.15 = $71.85
Rate of markup based on selling price = = 33.8915%
b) Markdown = 212.00 - 175.45 = 36.55
Rate of markdown = = 17.2406%
c) Total cost = cost + expense
= 140.15 + 0.17(212)
= 140.15 + 36.04
= $176.19
Profit = 175.45 - 176.19 = -0.74 (a loss)
d) Rate of markup realized based on cost
= = = 25.1873%

Kaz purchases an article with a net price of $114.54 after a discount of 17% was allowed. Calculate the list price.

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Question 4

The Paintball Park bought 100 paint ball guns auctioned off en bloc for $7889.00. This means that each gun has the same cost. On inspection, the guns were classified as high quality, medium, and low quality. The 70 high quality guns were sold at a markup of 135% of cost, the 22 guns classified as medium were sold at a markup of 36% of cost, and the guns classified as low quality were sold at 73% of their cost. What was the unit price at which each of the three classifications was sold?

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Question 5

The Snow Store received an invoice for $6 710.00 dated July 13, terms 5/10, 2/30, n/90, for a shipment of skis. The Ski Shop made two partial payments. a) How much was paid July 20 to reduce the unpaid balance to $4000.00? b) How much was paid on August 11 to reduce the outstanding balance by $1700.00?

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Question 6

Barmby's Aquarium Supplies purchased sets of aquariums for $315.00 less 10%, 12%. Expenses are 21% of the regular selling price and the required profit is 42% of the regular selling price. The store decided to change the regular selling price so that it could offer a 20% discount without affecting its margin. During the Christmas season, the unsold sets were advertised at a discount of 40%. What operating profit or loss was realized on the sets sold during the Christmas season?

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Question 7

Sheldan Services sells oil at a markup of 46% of the selling price. If Sheldan paid $1.99 per litre of oil, a) what is the selling price per litre? b) what is the rate of markup based on cost?

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Question 8

What is the list price of an article that is subject to discounts of 40.5%, 10.4%, 5.0% if the net price is $650.00?

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Question 9

Encino Ltd. received an invoice dated February 16 for $520.00 less 25%, 8.75%, terms 3/15 E.O.M. A cheque for $159.20 was mailed by Encino on March 15 as part payment of the invoice. a) By how much did Encino reduce the amount due on the invoice? b) How much does Encino still owe?

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Question 10

A store has an end of season sale on snow blowers. The original price was $679.98. The first discount is 10% and the second discount is 14%. What is the final sale price of the snow blowers?

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Question 11

A store advertises a discount of $54.72 on sandals. If the discount is 33.5%, for how much were the sandals sold?

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Question 12

Daffodil Supplies received a partial payment of $2 300.50 from J&K Landscape company on June 7 on an invoice of $7 539 dated May 12, terms 5/10, 3/30, n/60. a) For how much should the Daffodil Supplies credit J&K Landscape's account for the payment? b) How much does J&K Landscape still owe on the invoice?

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Question 13

For Your Eyes Only Company bought plasma screen TV sets for $11 585 less 4.5%, 3.2%. Overhead is 19% of regular selling price and required profit is 31% of regular selling price. The gas plasma TV sets were marked at a new regular selling price so that the store was able to advertise a discount of 10% while still maintaining its margin. To clear the inventory, the remaining TV sets were marked down 15%. What operating profit or loss is realized at the clearance price?

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Question 14

A gas generator cost a retailer $400.00 less 20%, 17%, 3%. It carries a regular selling price on its price tag at a markup of 90% of the regular selling price. During the end-of-season sale, the gas generator is marked down 40%. What is the end-of-season sale price?

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Question 15

The net price of an article is $272.20 after discounts of 21% and 16% have been allowed. What was the list price?

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Question 16

Export Ltd. received an invoice dated August 21 from Dutch Specialties of Amsterdam with terms 5/20, n/45 for: 10 wood trays at $37.45 each; 35 wood planters at $43.75 each; 50 wood bowls at $37.25 each. All items are subject to trade discounts of 33.5%, 7.125%, 4%. a) What is the last day of the discount period? b) What is the amount due if the invoice is paid in full on September 6? c) If only a partial payment is made on the last day of the discount period, what amount is due to reduce the outstanding balance to $1500.00?

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Question 17

Wayne's Pet Supplies sells dog food for $84.50 per 10-kg bag. The markup is 62% of cost. How much does the store pay for this bag of dog food?

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Question 18

Determine the net price of an article listed at $12 050 less 20%, 16%, %.

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Question 19

The net price of a tennis racket is $79.99. What is the list price if a discount of 35% was allowed?

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Question 20

Showing 1 - 20 of 119

A tire dealer bought tires from a wholesaler at $75.00 dollars each and sold the tires at a mark-up of 25% of cost. a) Calculate the selling price of the tires. b) Calculate the rate of markup based on the selling price.

Compute the rate of discount allowed on a cordless drill that lists for $149.99 and is sold for $79.99.

Kaz purchases an article with a net price of $114.54 after a discount of 17% was allowed. Calculate the list price.

Sheldan Services sells oil at a markup of 46% of the selling price. If Sheldan paid $1.99 per litre of oil, a) what is the selling price per litre? b) what is the rate of markup based on cost?

What is the list price of an article that is subject to discounts of 40.5%, 10.4%, 5.0% if the net price is $650.00?

Encino Ltd. received an invoice dated February 16 for $520.00 less 25%, 8.75%, terms 3/15 E.O.M. A cheque for $159.20 was mailed by Encino on March 15 as part payment of the invoice. a) By how much did Encino reduce the amount due on the invoice? b) How much does Encino still owe?

A store has an end of season sale on snow blowers. The original price was $679.98. The first discount is 10% and the second discount is 14%. What is the final sale price of the snow blowers?

A store advertises a discount of $54.72 on sandals. If the discount is 33.5%, for how much were the sandals sold?

A gas generator cost a retailer $400.00 less 20%, 17%, 3%. It carries a regular selling price on its price tag at a markup of 90% of the regular selling price. During the end-of-season sale, the gas generator is marked down 40%. What is the end-of-season sale price?

The net price of an article is $272.20 after discounts of 21% and 16% have been allowed. What was the list price?

Wayne's Pet Supplies sells dog food for $84.50 per 10-kg bag. The markup is 62% of cost. How much does the store pay for this bag of dog food?

Determine the net price of an article listed at $12 050 less 20%, 16%, %.

The net price of a tennis racket is $79.99. What is the list price if a discount of 35% was allowed?

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