Markup Percentage:

Markup in accounting refers to the amount that is added to the cost of merchandise inventory to calculate the selling price, in other words, markup is the amount added to cover operating expenses and generate profits.

Answer and Explanation:

1) The mark-up percentage on the cost of goods sold is:

 66.67% ($216,000 /$324,000) Gross profit $216,000 Cost of goods sold 324,000 Mark-up percentage on the cost of goods sold 2) The mark-up percentage on the total cost is:  48% Gross profit$216,000 Cost of goods sold 324,000 Operating expenses 126,000 Total cost $450,000 Mark-up percentage on the total cost 3) The gross margin percentage is:  40% ($216,000 / $540,000) Sales revenue$540,000 Cost of goods sold 324,000 Gross margin $216,000 Gross margin percentage 4) The price of the new product will be: $70 Wholesale cost \$42 Markup on cost of goods sold 66.67% Selling price

Learn more about this topic:

How to Calculate Markup: Definition & Formula

from Principles of Marketing: Help and Review

Chapter 12 / Lesson 22
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