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In a detailed cost breakdown, a company has a salary cost of 9%, raw materials cost 51% and overheads cost 24%. Which of the following represents the mark-up of that company?
Suggested Answer: B
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Mark-up is the amount added to the cost of an item to get to its selling price and is expressed as a percentage.
Mark-up (%) = (Price - Cost) / Cost x 100
= (100 - 9 - 51 - 24) / (9 +51 +24) x 100 = 16 / 84 x 100 = 19.04%
LO 2, AC 2.1
27 comments · newest first
WI
Willard
4 months ago
I feel confident! Just subtract total costs from 100%. Simple math!
DE
Delisa
4 months ago
Total costs are 84%. Mark-up is the difference from 100%. So, 16%.
MA
Mattie
4 months ago
Mark-up is usually based on total costs. We need to add those percentages.
TU
Tuyet
4 months ago
This question is tricky. I’m not sure about the mark-up calculation.
EL
Elina
4 months ago
Totally makes sense, good breakdown!
GW
Gwen
6 months ago
I thought salaries would be higher in this industry.
OL
Oliva
6 months ago
Wait, is that really enough for profit?
CA
Carey
6 months ago
So the mark-up must be 16%!
AU
Audria
6 months ago
That's a total of 84% in costs.
ED
Edmond
7 months ago
The mark-up is 16%? Well, at least they're not gouging their customers. Or are they...?
TA
Tammara
7 months ago
16% mark-up? That's it? I thought companies these days were aiming for at least 50% mark-up. Gotta step up their game!
WY
Wynell
7 months ago
Wait, does that mean the company is making a 16% profit? Seems a bit low, if you ask me.
CA
Candida
7 months ago
16% mark-up? Sounds about right. Time to start my own company and charge 51% for raw materials!
DA
Dan
7 months ago
Ah, the old "what's left is the mark-up" trick. Gotta love these accounting questions!
ST
Stevie
7 months ago
The mark-up must be the remaining percentage, which is 16%.
AR
Argelia
8 months ago
If I recall correctly, we need to add up the costs first and then determine the selling price to find the mark-up.
HE
Hermila
8 months ago
I feel like I might be mixing up mark-up and profit margin. Is there a formula we should use here?
GA
Gaynell
9 months ago
This seems similar to a practice question we did last week. I think mark-up is calculated on top of the total costs, right?
FR
Francine
9 months ago
I remember we discussed mark-up in class, but I'm not entirely sure how to calculate it from these percentages.
DO
Donte
9 months ago
Alright, time to put my math skills to the test. I've got this!
JA
Jacqueline
9 months ago
I remember learning about this in class. I think I can use the information given to solve for the mark-up.
RA
Raylene
9 months ago
Wait, I'm a bit confused. How do I calculate the mark-up from those percentages?
SE
Serita
9 months ago
Okay, let me think this through. I need to find the total of those percentages and then subtract from 100%.
CA
Carrol
10 months ago
Hmm, this looks like a straightforward calculation. I think I can figure this out.
LU
Luis
3 months ago
That makes sense! Simple math!
PH
Phyliss
3 months ago
So, the mark-up would be the remaining 16%.
DA
Daren
4 months ago
I think the total costs add up to 84%.