An item has a 45% markup based on selling price. What is the equivalent markup percent based on the cost?
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To find the equivalent markup percent based on the cost, we need to understand the relationship between the selling price and the cost.
We know that the selling price has a 45% markup based on the selling price. This means that the selling price is 145% of the cost.
To find the equivalent markup percent based on the cost, we can use the formula:
Markup percent based on cost = (Selling price - Cost) / Cost * 100
In this case, we need to rearrange the formula to solve for the markup percent based on the cost:
Markup percent based on cost = (Selling price - Cost) / Cost * 100
= ((145% of Cost) - Cost) / Cost * 100
Now we can calculate the markup percent based on the cost:
Markup percent based on cost = ((145% of Cost) - Cost) / Cost * 100
= (1.45 * Cost - Cost) / Cost * 100
= (0.45 * Cost) / Cost * 100
= 45%
Therefore, the equivalent markup percent based on the cost is 45%.