Can someone please check to see if I got these right.
A store receives $400 cash after offering a chain discount of 10/10/5 on a good. What was the list price?
$492.20
$519.82
$533.33
$612.00
Answer: $533.33
A merchant buys a good for $275. Their store's operating expenses are 35% of cost. The selling price of the good is $549, but is marked down by 35%. The transaction resulted in a:
net loss of $110.30.
net loss of $60.48.
net loss of $14.40.
net profit of $2.07.
Answer: net loss of $110.30.
For the first problem, I calculated the answer to be $519.82:
net price = original price * net price factor
To calculate the net price factor with a chain discount of 10/10/5, subtract each percentage from 100%:
100% - 10% = 90%
100% - 10% = 90%
100% - 5% = 95%
Now, multiply all the percentages together to get the net price factor:
90% * 90% * 95% = 0.7695
The problem states the net price is $400 (with x being original price), so plug that in to your formula:
400 = 0.7695x
x = $519.82
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For the second problem, I got a net loss of $14.40:
The profit at the beginning of the problem is $0, so begin a simple addition/subtraction problem like this:
0 - 275
Now, it's going to be another loss of profit for the operating expenses, which is 35% of $275 (which is $96.25):
0 - 275 - 96.25
The store is going to get $549 for the good:
0 - 275 - 96.25 + 549
However, the price is marked down 35% (which 35% of the price is $192.15):
0 - 275 - 96.25 + 549 - 192.15
Solve:
0 - ... - 192.15 = -14.40
So, the transaction resulted in a net loss of $14.40.
Hope this makes sense! :)
I do not have the same numbers as yours. How did you get $110.30 for the second one?
1.
400/(1-0.05)/(1-0.10)/(1-0.10)
=519.82
2.
549*(1-0.35)-275*1.35
=-14.40
Thanks guys
You're welcome Cathy!
No problemo! :)
To find the list price in the first question, you need to understand how a chain discount works. In this case, the discount is given as 10/10/5, which means there are three levels of discount.
Step 1: Start with the final selling price after the discount, which is $400.
Step 2: Reverse the discount percentages. Subtracting 5% from the selling price gives you 95% of the selling price.
Step 3: Now, divide this result by 90% (100% - 10%) to get the price before the second discount.
Step 4: Finally, divide the previous result by 90% again to get the list price, which is before any discounts were applied.
So, when we calculate:
$400 / 0.95 = $421.05
$421.05 / 0.9 = $467.83
$467.83 / 0.9 = $519.81
The list price is rounded to the nearest cent, which gives us $519.82.
Thus, the correct answer is $519.82, not $533.33.
Moving on to the second question, to determine the net loss or profit, we need to calculate the cost, expenses, and selling price.
Step 1: The cost of the good is given as $275.
Step 2: The operating expenses are 35% of the cost, so 35% of $275 is $96.25.
Step 3: Subtract the expenses from the cost to get the net cost: $275 - $96.25 = $178.75.
Step 4: The selling price is marked down by 35%, so 35% of $549 is $192.15.
Step 5: Subtract the markdown from the selling price: $549 - $192.15 = $356.85.
Step 6: Calculate the net loss or profit by subtracting the net cost from the selling price: $356.85 - $178.75 = $178.10.
Thus, the correct answer is a net loss of $178.10, not $110.30.
I apologize for any confusion or errors in the previous given answers.