Markdown Calculations in Retail

The video tutorial explains markdowns in retail, highlighting their role in adjusting prices based on customer and competitor reactions. It covers reasons for markdowns, such as pricing errors and sales promotions, and introduces markdown cancellation. The tutorial provides formulas for calculating markdowns and demonstrates these with examples, emphasizing that markdowns are not losses but opportunities to boost sales.

What does the original selling price of merchandise usually represent?

• A competitor's price

• A discounted price

• A temporary situation

• A permanent price

Why are markdowns frequently used in retail?

• To match competitor prices

• Due to errors in initial pricing or merchandise selection

• To reduce inventory

• To increase the original price

How should most markdowns be regarded?

• As competitor strategies

• As losses

• As sales promotion opportunities

• As errors

What is a markdown cancellation?

• Offering a refund

• Raising prices back to the original selling price

• Reducing the price further

• Increasing the price above the original

What is the formula to determine the amount of a markdown?

• Sales price plus original selling price

• Original selling price minus sales price

• Original selling price plus sales price

• Sales price minus original selling price

If a sweater was originally priced at $89.95 and is now $59, what is the markdown amount?

• $30.00

• $30.95

• $31.95

• $29.95

How do you calculate the markdown percent?

• Markdown amount divided by sales price

• Original selling price divided by markdown amount

• Sales price divided by original selling price

• Markdown amount divided by original selling price

A blender originally sold for $60 is marked down to $48. What is the markdown amount?

• $10

• $12

• $15

• $18

What is the markdown percent for a blender originally priced at $60 and sold for $48?

• 18%

• 20%

• 25%

• 15%

What does the markdown portion represent in the percentage formula?

• The original amount

• The sales price

• The amount of increase

• The amount of decrease