Spot Deliveries purchased an item by putting $5,000 down and financing the balance. The down payment was 20 percent of the cost of the item. What was the cost of the item?
Let x be the cost of the item. Since the down payment was 20 percent of the cost of the item, we can set up the following equation:
0.20x = $5,000
To solve for x, we divide both sides by 0.20:
x = $5,000 / 0.20
x = $25,000
Therefore, the cost of the item was $25,000.