Posted by unknown on .
if a grocery store buys 30 gallons of milk at a cost of $1.58 per gallon, he anticipates a 15% spoilage rate , to achieve a 20% markup based on selling price what should it be
I say $ 2.19 per gallon
The cost of the milk to the store is
30 x $1.58 = $47.40
To recover the cost of the milk if 15% lost then the cost per gallon is
$47.40/25.5 = $1.86 per gallon
$1.86/0.80 = $2.35 per gallon
which is %20 markup based on selling price.
20% markup of cost will give a different result.
...check my maths though!