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BUYING AND SELLING

PREPARED BY:
FERDINAND M. JARDELEZA, LPT
SUBJECT TEACHER
The price (per unit) incurred relative to the production and
sale of a commodity

ATE ROTCING POS

OPERATING COST
RAP ME UP RICK

MARK UP PRICE
PRINGLLE CISE
SELLING PRICE
TIP FOR

PROFIT
TEAM PARKUR
MARK UP RATE
Now, pretend that during the actual food sale, your group
realizes that there is such a high demand for your banana cue
and that buyers can easily afford the selling price you have
pegged. Some businesses will want to take advantage of this
peak season and thus, increase the prices already pegged for
their commodities.

This is what we call the MARK-ON.


MARK-ON = PEAK SELLING PRICE REGULAR SELLING PRICE

MO = PS S
where MO = Mark-On
PS = Peak Selling Price
S = Regular Selling Price
Why a mark-on becomes an option for a business owner.
The following reasons may be cited by the students:

a calamity has hit the source of a raw material or commodity


therefore affecting its supply

seasonal demands (Christmas items, Valentines, etc.)

special occasion is being celebrated (commemorative, death


anniversary, etc.)
Examples:

1. Manang Crising observes that market goers prefer to buy fish from her because there
is an undersupply of meat in the market this season. She then decides to increase the
price of galunggong by PHP10 per kilo. If the cost of galunggong is PHP90 per kilo
with a 35% mark-up, what is its new selling price with the additional increase of
PHP10? By how much is the rate of mark-up based on cost increased by adding PHP10
to the regular selling price of the galunggong?

Solution:
Selling Price after increase:
MU = 0.35 S
= 0.35 90 PS = S + MO
= PHP31.50 = 121.50 + 10
= PHP131.50
Selling Price before increase:
S = C + MU 31.50+10
Combined Rate of Mark-up and Mark-on = = 0.4611 = 46.11%
= 90 + 31.50 90
= PHP121.50 46.11 35 = 11.11%
The mark-up is increased by 11.11% by the additional mark-on of
PHP10 imposed by Manang Crising.
2. Yvettes Flower Shop imposes a 45% mark-up on flowers delivered to
them for sale. During All Saints Day, however, an additional mark-on of
25% of the regular selling price is added on. Determine the unit price of
300 roses worth PHP15000 delivered to Yvettes Flower Shop during All
Saints Day. How much is the selling price of each rose during All Saints
Day at this flower shop?
Solution:
15000 MO = 0.25 S
Unit Price = = PHP50 = 0.25 72.50
300
= PHP18.125 PHP18.15
MU = 0.45 C
= 0.45 50 PS = S + MO
= PHP22.50 = 72.50 + 18.15
= PHP 90.65
S = C + MU Each rose sells for PHP90.65 at Yvettes Flower Shop during
= 50 + 22.50 All Saints Day.
= PHP72.50
3. Find the regular selling price and the cost price of memorabilia items
being sold for PHP500 if the mark-up is set at a rate of 25% of the cost
price with an approved 15% mark-on rate based on the cost price
included because of a special event.

Solution:
PS = C + MU + MO MU = 0.25 C
= C + 0.25 C + 0.15 C = 0.25 357.14
500 = 1.40 C
500 = PHP89.29
C= = PHP357.14
1.40

The cost price of the memorabilia S = C + MU


item is PHP357.14. = 357.14 + 89.29
= PHP446.43
The regular selling price of the memorabilia item is
PHP446.43.
Think of a simple food sale to raise funds for
a project that their organization plans to
pursue.