Question

The boy’s buyer purchases 10 dozen pairs of shorts at $180 per dozen, and 5 dozen tank tops at $72 per dozen.  The target markup for the department is planned at 52%. If the shorts are priced at $32 each, what retail price must be placed on the tank tops in order to achieve the target markup goal?

The answer is $11.00 I just don't know how to get there.

Answer 1

Total price or cost of shorts = 10 dozen @ 180 per dozen =						1800
Total cost of tank tops = 5 dozen @ 72 per dozen						360
Total cost =		1800 + 360 = 2160
Markup for department is 52%. It means Profit is 52% of sales.
If sales is 100 , then Markup is 52
So, cost = 100 - 52 = 48
Cost of $2160 is equal to 48%, so Sales price = 2160 / 48 * 100						4500
So, Total sales price of Shorts and Tank tops is $4,500.
Now, price of shorts is 32 per shorts
So, Total sales price of shorts = 10 * 12 * 32 =						3840
(there are 120 pairs of shorts)
So, remaining sales price for tank tops to achieve target goal = 4500 - 3840 =						660
Total tank tops = 5 * 12 = 60
So, price per tank top = 660 / 60 =						11
So, price per tank top is $11.00 in order to achieve target markup goal.