Earlier in the year, a sporting goods store bought thirty pairs of football boots at a cost of $25.00 each and they were priced to sell at $36.00 each. As the season is nearly over, it plans on marking down the remaining ten pairs by 26 percent. Round your final answers properly to two decimal places. a)  What is the total cost?  the right answer is $750.00 b)  What is the sale price? the right answer is 26.64 c)  What is the total markdown? I got 9.36 but this is wrong answer d)  What is the total sales (TS)? this is the right answer 986.40 e)  What is the effective markup rate based on the (total) selling price? this is the wrong answer 31.52

Expert Answers

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I'll address parts C and E, since you identified those as the wrong answers;

Part C: The total markdown

  • The question told us that "the final ten pairs will be marked down by 26%". We are assuming that this 26% applies to the $36 sale price, not the original $25 price that the store bought them for, because this would mean they lose money.
  • 100% - 26% =74%
  • 36.00 x .76 = 26.64, the sale price.
  • The difference is 36 - 26.64 = 9.36

So perhaps your teacher meant something different - like the total markdown for all ten pairs? This would be 10 x 9.36 = $93.60.

You should probably ask your teacher to explain what they wanted you to do here, because $9.36 looks like the right answer to me.

Part E: The effective markup rate

  • The effective markup rate is going to be a combination of the $36 price and the discount price, compared to the original cost of the boots.
  • (20 x 36) + (10 x 26.64) = 986.40
  • (986.4 / (25x30)) = 1.3152 x 100 = 131.52% of the original cost.
  • This is a 31.52% markup, averaged between the $36 price applied to the original sale, and the $26.64 price applied to the discount.

Again, 31.52 appears to be the correct answer. I'm not sure that your teacher is fully explaining what they expect to be done with these two answers. If you have any information please clarify and I'll try to assist.

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