how to calculate the cost of an item if the retail is $40 and the markup is 20%
cost(1+.20) = 40
1.2x = 40
Solve for x.
x=87.71
To calculate the cost of an item given the retail price and markup percentage, you can use the formula:
Cost = Retail Price / (1 + Markup Percentage)
In this case, the retail price is $40 and the markup percentage is 20%.
Step 1: Convert the markup percentage to a decimal.
Markup Percentage = 20% = 0.20
Step 2: Apply the formula to get the cost:
Cost = $40 / (1 + 0.20)
Cost = $40 / 1.20
Step 3: Calculate the result:
Cost = $33.33 (rounded to two decimal places)
Therefore, the cost of the item, given a retail price of $40 and a markup of 20%, would be approximately $33.33.