Entrepreneurship and Small Business Management

Determining Selling Price-Markup Based on Selling Price

Records of past sales and expenses can be used to plan the markup rate needed to cover overhead expenses and yield a profit. The markup rate (based on selling price) and the cost of an item can be used to figure a selling price.

1.		The Elementary Bookstore knows from past expense records that it must aim for a markup that is 30% of the selling price of its merchandise. The store received a shipment of fairytale books at a cost of $5.62 per book. What is the minimum selling price that the store should charge?
			A)	$7.99
			B)	$6.25
			C)	$8.57
			D)	$8.03
2.		What would be an appropriate selling price for an item that cost $425 when the markup rate needs to be 25% of the selling price?
			A)	$552.50
			B)	$698
			C)	$566.67
			D)	$499.99
3.		What would be an appropriate selling price for an item that cost $0.15 when the markup rate needs to be 75% of the selling price?
			A)	$0.60
			B)	$1.00
			C)	$0.90
			D)	$0.42
4.		In the formula for selling price, the term "100% - Markup Rate" can be called the complement of the markup rate. What is the complement of a 67% markup rate?
			A)	167%
			B)	15%
			C)	43%
			D)	33%
5.		If an item's cost is $54.71 and the markup rate is 40%, what is the complement of the markup rate?
			A)	45.29%
			B)	60%
			C)	80%
			D)	54%
6.		What would be the selling price of the item mentioned in problem 5?
			A)	$91.18
			B)	$87.65
			C)	$90.99
			D)	$109.22
7.		If an item's cost is $789 and the markup rate is 52%, what is the complement of the markup rate?
			A)	78%
			B)	48%
			C)	58%
			D)	28%
8.		What would be the selling price of the item mentioned in problem 7?
			A)	$825.25
			B)	$937.67
			C)	$1643.75
			D)	$1589
9.		It costs May's Flour $1.45 to make one loaf of bread. May marks each loaf up 32% of the selling price. What is the selling price for one loaf?
			A)	$1.50
			B)	$2.13
			C)	$2.01
			D)	$1.86
10.		In problem 9, how much money is May's markup on each loaf of bread?
			A)	$0.05
			B)	$0.90
			C)	$1.00
			D)	$0.68
11.		Nancy's Frame Shop has a storewide policy to mark up each item 58% of the selling price. Nancy buys a pack of metal picture frames at a cost of $3.19 per frame. What is the selling price of each frame?
			A)	$7.60
			B)	$5.19
			C)	$8.22
			D)	$10.05
12.		In problem 11, how much money is Nancy's markup on each frame?
			A)	$4.41
			B)	$2.00
			C)	$4.06
			D)	$3.27
13.		The chemicals Hans uses to dry clean a man's dress shirt cost $0.25. Hans needs to mark up the service of dry cleaning shirts 82% of the selling price in order to pay his employees and still make a profit. What price should he charge for dry cleaning a man's shirt?
			A)	$1.45
			B)	$0.99
			C)	$1.39
			D)	$1.15
14.		It costs The Paper Wheel $1.00 to produce one roll of paper. The Paper Wheel puts an 18% markup (based on selling price) on the paper rolls when it sells to retail stores. What is the selling price of one roll?
			A)	$1.18
			B)	$1.22
			C)	$1.15
			D)	$1.74
15.		When Carlos's craft supply store sells a paper roll he bought from The Paper Wheel of problem 14, he marks it up 35% of the selling price. What is the selling price of the roll at his store?
			A)	$5.65
			B)	$3.47
			C)	$2.09
			D)	$1.88
16.		Based on the information in problems 14 and 15, what is the total amount of markup (from both the manufacturer and the retailer) a customer pays for when she buys a paper roll from Carlos's store?
			A)	$1.09
			B)	$1.10
			C)	$0.88
			D)	$0.74
17.		Suppose the Paper Wheel in problem 14 also sells its products to the public at a factory outlet store. In the outlet store, all items are marked up 30% of the selling price. What is the selling price of one roll of paper?
			A)	$1.30
			B)	$1.43
			C)	$1.57
			D)	$1.88
18.		Marcello pays $13.50 for each child's watch he sells in his jewelry shop. The markup on the watches is 47.5% of the selling price. What is the selling price for one child's watch?
			A)	$25.71
			B)	$17.99
			C)	$28.50
			D)	$24.02
19.		Rosie buys baby strollers for $35.67 for her baby supply store. She sells each stroller for $79.99. What is the markup on each stroller?
			A)	$115.66
			B)	$42.30
			C)	$44.32
			D)	$23.18
20.		In problem 19, the markup on each stroller is what percent of the selling price?
			A)	44.3%
			B)	24.5%
			C)	37%
			D)	55.4%