SOLUTION: Assume markup based on cost. Selling price, $600; markup % = 60 What was the actual cost?

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Question 1025003: Assume markup based on cost.
Selling price, $600; markup % = 60
What was the actual cost?
Answer by Theo(13342) About Me  (Show Source):
You can put this solution on YOUR website!
selling price = cost + markup * cost

selling price = 600
markup = 60%

600 = cost + 60% * cost

60% is equal to .6

600 = cost + .6 * cost

factor out cost to get 600 = cost * (1 + .6)

simplify to get 600 = cost * 1.6

divide both sides by 1.6 to get 600 / 1.6 = cost

solve for cost to get cost = 375

you have cost = 375.

60% markup on cost makes selling price = 375 + 60% * 375.

60% * 375 = .6 * 375 = 225

selling price = 375 + 225 = 600

the solution is confirmed as good.