Jose’, store manager for SportsHaven, does not know how to price a GE freezer that cost the store $580. Jose’ knows his boss wants a 25% markup on selling price. How much should Jose’ price the freezer?
580 * 1.25 = $___________________
Thanks. Also, what can we do if they said 25% markup on cost instead of selling price?
Ms Sue actually found the markup based on the cost price
to find the markup based on the selling price, let the selling price be x
profit = x-580
and (x-580)/x = .25 = 1/4
4x - 2320 = x
3x = 2320
x = 773.33
check: the profit = 773.33-580 =193.33
rate based on SP = 193.33/773.33 = .25
To determine the selling price of the GE freezer, Jose' needs to calculate the markup amount and then add it to the cost price.
1. Calculate the markup amount:
Markup = 25% of the cost price
Markup = 25/100 * $580
Markup = $145
2. Add the markup amount to the cost price to get the selling price:
Selling price = Cost price + Markup
Selling price = $580 + $145
Selling price = $725
Therefore, Jose' should price the GE freezer at $725.