If an item that sells for $81.00 has a 50.0% markup on cost, what is the cost?
cost + 0.5*cost = 81.00
cost = ?
To solve this problem, we need to understand the concept of the markup. The markup is the difference between the selling price and the cost price of an item. It is usually expressed as a percentage of the cost price.
In this case, we know that the selling price is $81.00 and the markup percentage is 50.0%. To find the cost price, we can use the following formula:
Cost price = Selling price / (1 + markup percentage)
Let's substitute the given values into the formula:
Cost price = $81.00 / (1 + 0.50)
To compute this, we add 1 to the markup percentage to convert it into a decimal.
Cost price = $81.00 / 1.50
Now, we can divide $81.00 by 1.50 to find the cost price:
Cost price = $54.00
So, the cost price of the item is $54.00.