Question

A buyer plans to buy designer bows at $15,000 cost with an average MU of 47%. The first purchase is for $4,500.00 at cost and $9,000.00 at retail. What must the markup on the balance of the purchases be in order to maintain the average MU percentage?

Answer 1

24.29%

Step-by-step explanation:

markup percentage = (selling price - cost per unit) / cost per unit

total markup:

0.47 = (total retail price - $15,000) / $15,000

$15,000 x 0.47 = total retail price - $15,000

$7,050 = total retail price - $15,000

total retail price = $22,050

the store already sells $9,000 worth of goods, so that means that $13,050 goods at retail price will be purchased

we repeat our formula, only that this time we will calculate the MU %:

MU % = ($13,050 - $10,500) / $10,500 = $2,550 / $10,500 = 0.2429 = 24.29%