A suit buyer who plans sales of $75,000 at retail during April has an average markup goal of 54%. An order is placed with the B&C Sportswear Company for April delivery in the amount of $5,975 at cost and $11,000 at retail . What markup percentage must be made on the balance of the April purchases to achieve the planned markup?
Planned retail sales of April = $75,000 x 54% / 100 = $40,500
= $75,000 – $40,500 = $34,500
Sales to B&C sportwear = $11,000 – $5,975 = $5,025
Goods available for sale = $34,500 – $5,975 = $28,525
Required balance profit = $40,500 – $5,025 = $35,475
Purchase of retail price = $35,475 + $28,525 = $64,000
Markup % = $35,475/ $64,000 x 100 = 55.43%