I am really stumped. Can someone explain where the .654 came from and what the 1- is in parenthesis means? I semi-follow the first step, but cannot figure out how they created the .654 in the second step (!!!). If someone could explain these steps a little more I would GREATLY appreciate it.
They are wanting to know what the Retail Dollar is for this item, given the Gross Profit percentage and Cost of the item.
Knowns: GP% = 34.6%
Cost of Item = $12.42
The "answer" exactly as they gave is as follows:
Retail Dollar= 12.42 divided (1-.346) my side question - what does the "1-" in the parenthesis mean?????
= 12.42 divided by .654 = $18.99 my Main question is how/where did they arrive at ".654"
So the Retail Dollar , or answer to this question is $18.99
Please Help!!!
Thank You!!!
UPDATE: I FIGURED IT OUT!!!!!
The steps and "formula" have proven correct in 3 examples I tried. Just for future ideas for others, I searched on about.com for business math and found a similar problem with the answer.
Okay, here was my problem:
1. I needed to find what the Retail Selling cost was, given the known Gross Profit percent and the Cost of the item in dollars.
Gross profit percent is 34.6%
Cost of the Item in dollars is $12.42
What is the Retail Selling Cost of this item?
2. I turned the verbiage of this equation to match the example I found on about.com
Just imagine this instead:
The item is on sale(cost) for $12.42, which is 34.6% off the retail "Full Price" selling cost. I imagined it was a case of Twinkies.....LOL!
Simply take the percentage as a whole number(346) and subtract it from 1000 (don't ask me why or how I came up with 1000, but trust me it works every time).
So, 1000 minus 346 is 654
Put a decimal to the far LEFT of the 654
Now divide the sale price (cost) of 12.42 by .654 and you get 18.9908 or 18.99
So 18.99 is the full Retail Selling Cost for the item.
This formula works every time.
Here is another example of this "formula" to try:
Gross Profit % 17.3
Cost of Item is $87.00
What is the Retail Selling Price for this item?
1. Simply change the 17.3% to 173
2. Subtract 173 from 1000 , which equals 827
3. Place the decimal to the far LEFT of the 827 (which would be .827)
4. Divide the 87.00 by .827 which gives you the full Retail Selling price of 105.1995 which you would round to 105.20
Make your own examples and give it a try. I'm sure this explanation is not "text book approved", but it works every time and makes sense to me.
Hope it helps you as well!!!!
They are wanting to know what the Retail Dollar is for this item, given the Gross Profit percentage and Cost of the item.
Knowns: GP% = 34.6%
Cost of Item = $12.42
The "answer" exactly as they gave is as follows:
Retail Dollar= 12.42 divided (1-.346) my side question - what does the "1-" in the parenthesis mean?????
= 12.42 divided by .654 = $18.99 my Main question is how/where did they arrive at ".654"
So the Retail Dollar , or answer to this question is $18.99
Please Help!!!
Thank You!!!
UPDATE: I FIGURED IT OUT!!!!!
The steps and "formula" have proven correct in 3 examples I tried. Just for future ideas for others, I searched on about.com for business math and found a similar problem with the answer.
Okay, here was my problem:
1. I needed to find what the Retail Selling cost was, given the known Gross Profit percent and the Cost of the item in dollars.
Gross profit percent is 34.6%
Cost of the Item in dollars is $12.42
What is the Retail Selling Cost of this item?
2. I turned the verbiage of this equation to match the example I found on about.com
Just imagine this instead:
The item is on sale(cost) for $12.42, which is 34.6% off the retail "Full Price" selling cost. I imagined it was a case of Twinkies.....LOL!
Simply take the percentage as a whole number(346) and subtract it from 1000 (don't ask me why or how I came up with 1000, but trust me it works every time).
So, 1000 minus 346 is 654
Put a decimal to the far LEFT of the 654
Now divide the sale price (cost) of 12.42 by .654 and you get 18.9908 or 18.99
So 18.99 is the full Retail Selling Cost for the item.
This formula works every time.
Here is another example of this "formula" to try:
Gross Profit % 17.3
Cost of Item is $87.00
What is the Retail Selling Price for this item?
1. Simply change the 17.3% to 173
2. Subtract 173 from 1000 , which equals 827
3. Place the decimal to the far LEFT of the 827 (which would be .827)
4. Divide the 87.00 by .827 which gives you the full Retail Selling price of 105.1995 which you would round to 105.20
Make your own examples and give it a try. I'm sure this explanation is not "text book approved", but it works every time and makes sense to me.
Hope it helps you as well!!!!
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