If the store purchases an item at a wholesale cost of $3.50 per item, and it is sold at a retail value of $5.00 per item. What is the gross profit percentage of the item?
(5.00 - 3.50) / 3.50 = ?
Multiply the decimal answer by 100 to find the percentage.
To find the gross profit percentage, we need to know the gross profit amount. The gross profit is the difference between the retail price and the wholesale cost.
Gross Profit = Retail Price - Wholesale Cost
In this case, the retail price is $5.00 per item, and the wholesale cost is $3.50 per item.
Gross Profit = $5.00 - $3.50
Gross Profit = $1.50
Now, we can find the gross profit percentage by dividing the gross profit by the retail price and multiplying by 100.
Gross Profit Percentage = (Gross Profit / Retail Price) * 100
Gross Profit Percentage = ($1.50 / $5.00) * 100
Gross Profit Percentage ≈ 30%
Therefore, the gross profit percentage of the item is approximately 30%.