Question

For a special sale, a mens tie buyer plans to promote a $39.99 tie. Consequently, the buyer purchases 450 ties and wants to achieve a 55% markup. An order for 100 ties that cost $20.00 each is also placed by this same buyer. What will be the average cost of the remaining pieces (Show two decimal places)?

Answer 1

The average cost of each tie is $56.350

Explanation:

We are given that a men tie buyer plans to promote a $39.99 tie. Consequently, the buyer purchases 450 ties

So, Cost of 450 ties =
`450 * 39.99=17995.5`

An order for 100 ties that cost $20.00 each

Cost of 100 ties =
`100 * 20 = 2000`

Total cost price = 17995.5+2000 = 19995.5

Let the selling price of 1 tie be x

Total ties = 450+100 = 550

So, SP of 550 ties =550x

Now we are given that markup is 55%

So, Profit % = 55%

So,
`CP = (SP * 100)/(100+P\%)`

Substitute the values

`19995.5 = (550x * 100)/(100+55)`

`19995.5 = (550x * 100)/(155)`

`19995.5 * 155 = 55000x`

`(19995.5 * 155)/(55000)=x`

`56.350=x`

Hence The average cost of each tie is $56.350