CAF-1 · Chapter 12 · Question 4 of 15
If a retailer sells goods at a 'mark-up' of 25% on cost, what is the equivalent gross profit 'margin' on sales?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) 20%
Explanation
A mark-up is calculated on cost. A 25% mark-up means if Cost is 100, Profit is 25, making Sales 125. The margin (Profit divided by Sales) is 25/125, which equals 20%.
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