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rolpace88 rolpace88
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Posts: 3242
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8 years ago
The Sports Shoppe is buying baseball t-shirts. The cost of the shirts, which includes permission fees, will be $11.44 each if 1000 shirts are purchased. Jamie sells 800 shirts before the baseball season begins at a 50% markup based on cost. What is the gross margin (markup) if Jamie sells the remaining 200 shirts at a 25% reduction from the selling price?
A) $11,154
B) $4862
C) $3575
D) $16,302
Textbook 
Business Math

Business Math


Edition: 10th
Authors:
Read 530 times
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wrote...
#1
Donated
Valued Member
8 years ago
$11.44*50% = $5.72 markup/shirt

$11.44 + $5.72 = $17.16 selling price/shirt

$17.16 selling price/shirt * 800 shirts: $13,728

Reduce the $17.16 by 25% for the remaining 200 shirts:
$17.16*75% = $12.87 selling price/shirt

$12.87 selling price/shirt * 200 shirts = $2,574

Total revenue from shirt sales = $13,728 + $2,574 = $16,302
Shirts were acquired for $11.44 * 1000 = $11,440
Gross markup = $16,302 - $11,440 = B) $4862
Pretty fly for a SciGuy
rolpace88 Author
wrote...
#2
8 years ago
Not sure why I found this tricky. Now that I know the answer, it's almost self-explanatory.
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