Fashions by Francis: Calculating Dollar Markup

Understanding Dollar Markup for Retailers

Fashions by Francis, a woman’s apparel retailer, purchases items to sell in its retail store. One essential aspect of retail business operations is calculating the dollar markup on products. In this case, let's explore how the dollar markup is determined when Francine buys a blouse for $30 and sells it for $45.

What is the Dollar Markup?

The dollar markup of the blouse sold by Fashions by Francis is calculated by subtracting the cost price ($30) from the selling price ($45), resulting in a markup of $15.

Explanation

The dollar markup of a product is a critical factor in determining a business's profitability. In this scenario, we are calculating the dollar markup for a blouse. To do this, we follow a straightforward formula: subtracting the cost price from the selling price.

First, we identify the cost price, which represents what the retailer paid to acquire the blouse, and in this case, it's $30. Next, we identify the selling price, which is the amount for which the blouse is sold to customers, and that's $45.

To calculate the dollar markup, we subtract the cost price from the selling price: $45 - $30 = $15. So, the dollar markup on the blouse is $15. This means that for each blouse sold, the retailer makes a profit of $15 over and above their initial cost. Understanding and effectively managing markup is crucial for businesses to set prices, analyze profitability, and make informed decisions about their products and pricing strategies.

Question

If Francine buys a blouse for $30 and sells it for $45, what is the Dollar Markup?

Answer

The dollar markup for the blouse sold by Fashions by Francis is $15.