Question

After a store marks up the wholesale price of an item by 75%, the retail price of the item is $350. A month later, the store puts the item on sale for 20% off the retail price. Two weeks later, the store offers 30% off the sale price. What is the final price of the item? Is the store making a profit on the item?

Answer 1

Let the wholesale price of the item = $x
Retail price =$350
x+(75/100)*x=350
x+(3/4)x=350
(4x+3x)/4=350
(7/4)x=350
x=350*(4/7)
x=50*4=$200

20% off on retail price =350-(20/100)*350
=350-70
Sale price =$280
30% off on sale price =280 -(30/100)*280
=280-84
Final price =$196 and wholesale price =$200
Since the final price is less than the wholesale price, the store is not making a profit. It is a loss.

Answer 2

Given the markup of 75%, the selling price of the item became:
Cost×(1+Markup)=selling price
the initial price of the house will therefore be:
C×(1+0.75)=350
1.75C=350
C=350/1.75
C=$200
therefore the initial selling price was $200. Given that after the markup price was later reduced by 20%, the new price became:
80/100×350
=$280
If the price was later reduced by 30% the new price was:
70/100×280
=$196
From this final price we see that if the original price was $200 and the selling price is now $196, then the item is actually selling at lose.