Chapter 8 - Markups and markdowns: Perishables and breakeven analysis. In this chapter, the learning objectives are: Calculate dollar markup and percent markup on cost, calculate selling price when you know cost and percent markup on cost, calculate cost when dollar markup at percent markup on cost are known, calculate cost when you know the selling price and percent markup on cost,. | Chapter Eight Markups and Markdowns: Perishables and Breakeven Analysis Copyright © 2014 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin LU 8-1: Markup Based on Cost (100%) Calculate dollar markup and percent markup on cost. Calculate selling price when you know cost and percent markup on cost. Calculate cost when dollar markup at percent markup on cost are known. Calculate cost when you know the selling price and percent markup on cost. Learning unit objectives Learning unit objectives LU 8-2: Markup Based on Selling Price (100%) Calculate dollar markup and percent markup on selling price. Calculate selling price when dollar markup and percent markup on selling price are known. Calculate selling price when cost and percent markup on selling price are known. Calculate cost when selling price and percent markup on selling price are known. Convert from percent markup on cost to percent markup on selling price, and vice versa. Calculate markdowns; compare . | Chapter Eight Markups and Markdowns: Perishables and Breakeven Analysis Copyright © 2014 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin LU 8-1: Markup Based on Cost (100%) Calculate dollar markup and percent markup on cost. Calculate selling price when you know cost and percent markup on cost. Calculate cost when dollar markup at percent markup on cost are known. Calculate cost when you know the selling price and percent markup on cost. Learning unit objectives Learning unit objectives LU 8-2: Markup Based on Selling Price (100%) Calculate dollar markup and percent markup on selling price. Calculate selling price when dollar markup and percent markup on selling price are known. Calculate selling price when cost and percent markup on selling price are known. Calculate cost when selling price and percent markup on selling price are known. Convert from percent markup on cost to percent markup on selling price, and vice versa. Calculate markdowns; compare markdowns and markups. Price perishable items to cover spoilage loss. LU 8-2: Markdowns and Perishables 3 Learning unit objectives LU 8-4: Breakeven Analysis Calculating contribution margin (CM). Calculating a breakeven point (BE). 4 Terminology Selling Price - The price retailers charge customers. Cost - The price retailers pay to a manufacturer or supplier. Markup, Margin, or Gross Profit - The difference between the cost of bringing the goods into the store and the selling price. Operating Expenses or Overhead - The regular expenses of doing business, such as rent, wages, utilities, etc. Net profit or Net Income - The profit remaining after subtracting the cost of bringing the goods into the store and the operating expenses. 5 Basic Selling Price Formula Assume Gap plans to sell hooded fleece jackets for $23 that cost them $18. 6 Markups Based on Cost (100%) Cost + Markup = Selling price 100% Dollar markup is the portion Percent markup on cost is the rate Cost is 100%
