Asked by Khaled Bushehri on Jul 14, 2024
Verified
A product costing $350, less 30%, 20%, and 10%, sells to allow for overhead expenses of 30% of the selling price and profit of 20% of the selling price. During a sale, the product is marked down by 40%. What is the final selling price?
A) $352.80
B) $211.68
C) $117.98
D) $86.43
E) $52.10
Overhead Expenses
Represents the ongoing costs of operating a business that are not directly tied to the production of goods or services, such as rent, utilities, and administrative salaries.
Profit
The financial gain achieved when the amount of revenue gained from a business activity exceeds the expenses, costs, and taxes involved in sustaining the activity.
Selling Price
The amount of money for which something is sold or offered for sale to a buyer.
- Apply multi-step percent-based calculations to solve business problems.
- Analyze the impact of discounts, mark-downs, and operating expenses on product pricing.
Verified Answer
KG
Karolina GruszowskiJul 19, 2024
Final Answer :
B
Explanation :
The product's original price is $350. The successive discounts of 30%, 20%, and 10% are applied first. The price after the first discount is $350 * 0.7 = $245. After the second discount, it's $245 * 0.8 = $196. After the third discount, it's $196 * 0.9 = $176.40. This is the price before adding overhead and profit. To find the selling price that includes a 30% overhead and a 20% profit on the selling price, we set up the equation $176.40 = S - 0.3S - 0.2S, where S is the selling price. Solving for S gives $176.40 = 0.5S, so S = $352.80. This is the price before the final 40% markdown. The final selling price after the 40% markdown is $352.80 * 0.6 = $211.68.
Learning Objectives
- Apply multi-step percent-based calculations to solve business problems.
- Analyze the impact of discounts, mark-downs, and operating expenses on product pricing.