CIPS L4M5 Exam - Topic 3 Question 93 Discussion

Actual exam question for CIPS's L4M5 exam

Question #: 93
Topic #: 3

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?

BApproximately 19%

AApproximately 84%

CApproximately 116%

DApproximately 16%

Show Suggested Answer

Suggested Answer: B

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

by Latrice at Jan 26, 2026, 12:26 AM

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Willard

2 months ago

I feel confident! Just subtract total costs from 100%. Simple math!

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Delisa

2 months ago

Total costs are 84%. Mark-up is the difference from 100%. So, 16%.

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Mattie

2 months ago

Mark-up is usually based on total costs. We need to add those percentages.

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Tuyet

2 months ago

This question is tricky. I’m not sure about the mark-up calculation.

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Elina

2 months ago

Totally makes sense, good breakdown!

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Gwen

4 months ago

I thought salaries would be higher in this industry.

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Oliva

4 months ago

Wait, is that really enough for profit?

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Carey

4 months ago

So the mark-up must be 16%!

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Audria

4 months ago

That's a total of 84% in costs.

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Edmond

5 months ago

The mark-up is 16%? Well, at least they're not gouging their customers. Or are they...?

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Tammara

5 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!

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Wynell

5 months ago

Wait, does that mean the company is making a 16% profit? Seems a bit low, if you ask me.

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Candida

5 months ago

16% mark-up? Sounds about right. Time to start my own company and charge 51% for raw materials!

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Dan

5 months ago

Ah, the old "what's left is the mark-up" trick. Gotta love these accounting questions!

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Stevie

5 months ago

The mark-up must be the remaining percentage, which is 16%.

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Argelia

6 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.

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Hermila

6 months ago

I feel like I might be mixing up mark-up and profit margin. Is there a formula we should use here?

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Gaynell

7 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?

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Francine

7 months ago

I remember we discussed mark-up in class, but I'm not entirely sure how to calculate it from these percentages.

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Donte

7 months ago

Alright, time to put my math skills to the test. I've got this!

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Jacqueline

7 months ago

I remember learning about this in class. I think I can use the information given to solve for the mark-up.

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Raylene

7 months ago

Wait, I'm a bit confused. How do I calculate the mark-up from those percentages?

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Serita

7 months ago

Okay, let me think this through. I need to find the total of those percentages and then subtract from 100%.

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Carrol

8 months ago

Hmm, this looks like a straightforward calculation. I think I can figure this out.

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Luis

1 month ago

That makes sense! Simple math!

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Phyliss

1 month ago

So, the mark-up would be the remaining 16%.

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Daren

2 months ago

I think the total costs add up to 84%.

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