petes deli sells corned beef at $2.55 per pound. it pays its wholesaler $1.95 per pound. what is the markup…

petes deli sells corned beef at $2.55 per pound. it pays its wholesaler $1.95 per pound. what is the markup rate based on a) cost and b) selling price? note: round to nearest tenth percent.

petes deli sells corned beef at $2.55 per pound. it pays its wholesaler $1.95 per pound. what is the markup rate based on a) cost and b) selling price? note: round to nearest tenth percent.

Answer

Explanation:

Step1: Calculate markup amount

Markup amount = Selling price - Cost price. Given selling price = $2.55 and cost price = $1.95. So, Markup amount = $2.55 - $1.95 = $0.60.

Step2: Calculate markup rate based on cost

Markup rate based on cost formula is $\frac{\text{Markup amount}}{\text{Cost price}}\times100%$. Substitute values: $\frac{0.60}{1.95}\times100% \approx 30.8%$.

Step3: Calculate markup rate based on selling - price

Markup rate based on selling - price formula is $\frac{\text{Markup amount}}{\text{Selling price}}\times100%$. Substitute values: $\frac{0.60}{2.55}\times100% \approx 23.5%$.

Answer:

Cost: 30.8% Selling price: 23.5%