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Difficulty: MediumPercentage Change, Markups, and Discounts

A sporting goods store acquires a shipment of professional-grade kayaks at a wholesale cost of $450.00\$450.00 each. The store applies a 60%60\% markup to establish the regular retail price. During an end-of-season clearance event, the kayaks are discounted by 25%25\% off the regular retail price. What is the final sale price of a single kayak?

  1. A
    $607.50\$607.50
  2. B
    $695.00\$695.00
  3. $540.00\$540.00Answer
  4. D
    $702.00\$702.00

Answer

$540.00\$540.00
The correct sale price is found by first adding the 60%60\% markup to the $450.00\$450.00 wholesale cost, resulting in a retail price of $720.00\$720.00. Then, the 25%25\% discount is applied to the $720.00\$720.00 retail price, creating a discount amount of $180.00\$180.00. Subtracting this discount from the retail price leaves a final sale price of $540.00\$540.00.

Step-by-Step Solution

1
Calculate the markup amount by finding 60%60\% of the wholesale cost.
$450.00×0.60=$270.00\$450.00 \times 0.60 = \$270.00
The store increases the wholesale price by 60%60\% to set the regular retail price.
2
Add the markup amount to the wholesale cost to find the regular retail price.
$450.00+$270.00=$720.00\$450.00 + \$270.00 = \$720.00
The retail price is the sum of the original cost and the markup.
3
Calculate the discount amount by finding 25%25\% of the regular retail price.
$720.00×0.25=$180.00\$720.00 \times 0.25 = \$180.00
The discount is based on the current retail price, not the wholesale cost.
4
Subtract the discount amount from the retail price to find the final sale price.
$720.00−$180.00=$540.00\$720.00 - \$180.00 = \$540.00
The final price is the retail price minus the discount.

Key Concept

Calculating sequential percentage changes by correctly identifying the new base value for each step.
Estimated Time:1m 0s
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Topics

Percentage Change, Markups, and Discounts

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