Question

When the manager of Fantastic Furniture buys a sofa from a manufacturer, she uses a markup of 45% of her cost to set the selling price of the sofa. What will be the selling price if the manager of Fantastic Furniture buys a sofa for $400? Show your work explain your reasoning.

Answer 1

Selling price= $580

Explanation:

eGiving the following information:

Buying price= $400

Mark-up percentage= 45% = 0.45

The manager applies a mark-up equivalent to 45% of the buying price. First, we need to determine how much is 45% of the cost.

Mark-up= buying price* Mark-up percentage

Mark-up= 400*0.45

Mark-up= $180

Now, the selling price:

Selling price= 400 + 180

Selling price= $580