A sweater sells for $130.50. Overhead expenses are 25% of cost and operating profit is 20% of cost. What rate of markdown will price the sweater at the break-even price?

Break-even Price

The price level at which revenues equal costs, resulting in neither profit nor loss.

Overhead Expenses

Costs not directly tied to the production of goods or services, such as rent, utilities, and administrative salaries.

Operating Profit

Earnings of a business before interest and taxes are deducted.

Master and use multiple percentage calculations in retail pricing, covering markdowns, markups, and discounts.
Ascertain the cost at which retail items neither generate profit nor incur loss.

Verified Answer

Final Answer :

13.79%

Learning Objectives

Master and use multiple percentage calculations in retail pricing, covering markdowns, markups, and discounts.
Ascertain the cost at which retail items neither generate profit nor incur loss.