The spoilage rate on a shipment of wheat is expected to be 20%. It was purchased at a cost of $5.35 per bushel. What should the selling price per bushel be to achieve a markup of 6% based on selling price?
0.94p = 5.35/.80
p = 7.11
Well, if the wheat has a spoilage rate of 20%, I guess you could call it a "breadventure"! Now, to find the selling price per bushel with a 6% markup, let's do some math tricks.
First, we need to find the cost per bushel with the spoilage rate taken into account. So, we can multiply the purchase cost of $5.35 by 0.8 (100% - 20% spoilage rate). That gives us a cost per bushel of $4.28.
To achieve a 6% markup based on the selling price, we need to find that 6% of the selling price and add it to the cost per bushel. Let's call the selling price "x". Therefore, the markup would be 0.06x.
So, the selling price per bushel should be the cost per bushel ($4.28) plus the markup (0.06x). This equation can be written as:
x = $4.28 + 0.06x
Now, let's solve this equation.
0.94x = $4.28
Dividing both sides by 0.94:
x ≈ $4.55
So, the selling price per bushel should be approximately $4.55 in order to achieve a 6% markup based on the selling price. That should wheat your appetite for profits!
To determine the selling price per bushel, we need to calculate the cost price per bushel and then add the markup.
1. Calculate the cost of spoilage:
Cost of spoilage = 20% of the cost per bushel
Cost of spoilage = 0.20 * $5.35 = $1.07 per bushel
2. Calculate the cost price per bushel:
Cost price per bushel = Purchase cost per bushel + Cost of spoilage per bushel
Cost price per bushel = $5.35 + $1.07 = $6.42 per bushel
3. Calculate the selling price per bushel with a 6% markup:
Markup = 6% of the selling price per bushel
Markup = 0.06 * Selling price per bushel
Selling price per bushel = Cost price per bushel + Markup
Selling price per bushel = $6.42 + 0.06 * Selling price per bushel
Rearrange the equation to solve for the selling price per bushel:
Selling price per bushel - 0.06 * Selling price per bushel = $6.42
0.94 * Selling price per bushel = $6.42
Selling price per bushel = $6.42 / 0.94
Therefore, the selling price per bushel should be:
Selling price per bushel ≈ $6.84
To determine the selling price per bushel, we need to factor in the expected spoilage rate and the desired markup percentage. Here's how we can calculate it:
First, let's calculate the cost per bushel after accounting for the spoilage rate:
Cost per bushel = Purchase cost per bushel ÷ (1 - Spoilage rate)
Cost per bushel = $5.35 ÷ (1 - 0.20)
Cost per bushel = $5.35 ÷ 0.80
Cost per bushel = $6.69
Next, let's calculate the selling price per bushel based on the desired markup percentage:
Markup amount = Markup percentage × Cost per bushel
Markup amount = 0.06 × $6.69
Markup amount = $0.40
Finally, let's calculate the selling price per bushel by adding the markup amount to the cost per bushel:
Selling price per bushel = Cost per bushel + Markup amount
Selling price per bushel = $6.69 + $0.40
Selling price per bushel = $7.09
Therefore, the selling price per bushel should be $7.09 in order to achieve a markup of 6% based on selling price.