QUESTION 1 (10 MARKS)
A grocer buys 100kg of bananas to sell. Experience indicates that about 10% of these bananas will be spoilt before they are sold. To obtain a markup of 50% on overall cost, he prices the bananas at RM3.00 per kg. How much do the bananas cost per kg?
To calculate the cost per kg at which the grocer bought the bananas, we can use the following equation:
Cost per kg = Selling price per kg / (1 + Markup percentage)
Given:
Selling price per kg = RM3.00
Markup percentage = 50%
Plugging in the values:
Cost per kg = RM3.00 / (1 + 0.50)
Cost per kg = RM3.00 / 1.50
Cost per kg = RM2.00
Therefore, the bananas cost RM2.00 per kg for the grocer.