IG ACME Outfitter S Sales Qty 230 40 80 550 Description Total Cost Sleeping bag $9,612.71 Tent $4,971.20 Items from Camper's Warehou Cash Discount $192.25 $99.42 Backpack $6,198.40 $123.97 Flashlight $2,392.00 $47.84 se Sales Qty Description Total Cost 150 Binoculars $4,914.00 340 First Aid Kits $3,477.60 Cash Discount $98.28 $69.55 Cost per Selling price Final Cost item per item $9,420.46 $40.96 $66.97 $4871.78 121.79 199.13 $6,074.43 75.93 124.15 $2,344.16 4.269.97 6.97 Cost per Selling price item per item Final Cost $4,815.72 32.10 $3,408.05 10.02 52.48 16.38 C. (12 points) Final Clearance. The current backpack model is no longer being manufactured. We want to run a close-out clearance sale on the backpacks left in stock to make room for the new model. The arbitrary markdown rates used in Part B may not have been realistic choices, so in this section you are asked to determine some markdown rates using mathematics and your knowledge of our cost and pricing system. 1. What is the break-even point on a backpack? Note that our operating expenses are 40.7% of cost. 2. What percent-off sale can we run on the backpacks and still make this break-even point? This is the biggest sale we can offer without losing money on the backpacks. Set reduced price = break-even point. Find the rate. 3. What percent-off sale can we run on the backpacks without incurring an absolute loss? That is, find the percentage markdown that would just cover the cost we paid for the backpacks. Set reduced price = cost. Find the markdown rate. IG ACME Outfitter S Sales Qty 230 40 80 550 Description Total Cost Sleeping bag $9,612.71 Tent $4,971.20 Items from Camper's Warehou Cash Discount $192.25 $99.42 Backpack $6,198.40 $123.97 Flashlight $2,392.00 $47.84 se Sales Qty Description Total Cost 150 Binoculars $4,914.00 340 First Aid Kits $3,477.60 Cash Discount $98.28 $69.55 Cost per Selling price Final Cost item per item $9,420.46 $40.96 $66.97 $4871.78 121.79 199.13 $6,074.43 75.93 124.15 $2,344.16 4.269.97 6.97 Cost per Selling price item per item Final Cost $4,815.72 32.10 $3,408.05 10.02 52.48 16.38 C. (12 points) Final Clearance. The current backpack model is no longer being manufactured. We want to run a close-out clearance sale on the backpacks left in stock to make room for the new model. The arbitrary markdown rates used in Part B may not have been realistic choices, so in this section you are asked to determine some markdown rates using mathematics and your knowledge of our cost and pricing system. 1. What is the break-even point on a backpack? Note that our operating expenses are 40.7% of cost. 2. What percent-off sale can we run on the backpacks and still make this break-even point? This is the biggest sale we can offer without losing money on the backpacks. Set reduced price = break-even point. Find the rate. 3. What percent-off sale can we run on the backpacks without incurring an absolute loss? That is, find the percentage markdown that would just cover the cost we paid for the backpacks. Set reduced price = cost. Find the markdown rate
