Problema Solution
The paint balls burst all over men suits causing a great loss. The owner, who had purchased all the suits for $60,000, had marked them up 30% but was forced to sell them half price. His additional expenses for repair and cleaning were $12,000. What was his net profit?
Answer provided by our tutors
Start price: $60,000
After 30% markup the new price was:
(1 + 0.30)*60,000 = 1.50*60,000 = $78,000
Half price is:
(1/2)*78,000 = $39,000
Additional expenses of $12,000 means:
$39,000 - $12,000 = $27,000
The net profit is:
$27,000 - $60,000 = - $23,000
Since the net profit is negative this means the owner has a loss of $23,000.