Calloway Department Store buys men’s department jeans for $19.75 a pair and sells them for $37.88. What is the markup rate based on cost?
The markup rate based on cost can be calculated using the following formula:
Markup rate = (Selling price - Cost price) / Cost price
In this case, the cost price of jeans is $19.75 and the selling price is $37.88.
Markup rate = ($37.88 - $19.75) / $19.75
Markup rate = $18.13 / $19.75
Markup rate = 0.919 / 1
Therefore, the markup rate based on cost is approximately 91.9%.