Markup Exercises
1) Harbourview Restaurant, is a famous seafood restaurant located in Pictou, Nova Scotia. Its menu states the selling price of lobster as “market price”. This season, fishermen are charging $6/lb. If the market requires a 30% markup on the selling price, what is the price you pay per pound at Harbourview Restaurant?
2) The local pub charges a $1.00 markup on each domestic beer it sells. A domestic beer sells for $3.50. What is the cost price? What is the percentage markup on the selling price?
3) An automobile dealer sells a car for $20,000. It cost him $16,000 to buy this car and get it ready for sale. What is the dealer’s …
a) dollar markup
b) markup on selling price
c) markup on cost
4) A sporting goods retailer buys a pair of running shoes for $75 and prices them to realize a $50 markup. What is …
a) the selling price
b) the markup on selling price
5) A convenience store buys 4 litre poly bags of milk for $4.99 and sells them for $5.29. What is the markup on selling price?
6) A fertilizer manufacturer sells through wholesalers to retailers. A 20 kg bag retails for $16.95. Retail markups are 35% and wholesaler markups are 10%. What is the manufacturer’s selling price?
7) A children’s book retails for $6.95. The retailer’s markup on selling price is 30%. What is the retail cost price?
8) Bev Smith makes hand-braided mats, at a cost of $40 per mat, to sell at local craft shows. She has 30 mats on hand for the next show, and expects to sell them all for a total of $1,800. What is Bev’s markup per mat in dollar and percentage terms?
9) A new multi-purpose clamp, the Vice-Master, has a retail selling price of $20. The retail margin is 40%, and the wholesale margin is 15%. The manufacturer’s variable cost per unit is four dollars.
a) What dollar markup does each channel member receive?
b) Which channel member receives the greatest margin? Is this reasonable? Why?
10) A ski jacket costs a retailer $85.00. The jacket is priced to generate a 45% markup on selling price. What is the retail selling price?
11) A manufacturer sells a pair of jeans to a wholesaler for $33. The wholesaler’s markup on the selling price is 20%. Jeanworld, where you bought your jeans takes a 50% markup on the selling price. How much did you spend on that pair of jeans?
12) Stan has a hot dog vending cart. She has 144 hotdogs with her when she learns there is a high school basketball tournament across the street. It is very close to lunch and she knows she will surely sell all of the hotdogs for $216. If each hotdog has a cost price $0.30, what is Stan’s percentage markup on selling price?
13) Pam just bought a new pair of shoes for $75. Colleen bought the identical pair of shoes at a discount retailer for $60. If the cost price of the shoes to each retailer is $50, what was the percentage markup on the selling price paid by each Pam and Colleen?
14) A manufacturer sells a 3 person tent to its wholesalers for $59.95. Wholesalers take a markup on selling price of 15% and sell to retailers who take a markup on selling price of 45%. How much does this tent cost you?
15) A wholesaler sells a piece of jewelry to a retailer for $900. The retailer’s markup on selling price is 60%. The wholesaler’s markup on selling price is 20%. What is the retail selling price of the item? What is the manufacturer’s selling price?
16) Marie's Flowers purchases a wide variety of houseplants. One of Marie's favourites, the large split leaf philodendron, costs $13.50 from the wholesaler and requires an additional $1.00 per plant to take care of and then package prior to sale. Marie's normal markup on houseplants is 55%. What would be the retail selling price of a large split leaf philodendron?
17) An auto parts manufacturer sells fan belts to its distributors for $10.95. Typical distributor markups are 20% and typical gas station markups are 40%. How much would you have to pay for a fan belt?
18) Birch Hollow Nurseries purchases 12 globe cedars for $67.00 and prices them to realize a markup of 30%. What is the nursery's selling price for one globe cedar?
19) An analysis of the competition suggests the average retail selling price of an electronic game is $89.00. The owner of "Chips 'n' DIP Switch", a computer accessories store has a chance to purchase 5 dozen of these games at a delivered cost of $55.00 per unit. Her normal markup on electronic games is 45%. Should she make the purchase? Why? Why not? Give reasons supporting either decision.