Tax, Tip, Commission, & Markup Flashcard

Front

What is a markup?

Back

A markup is the amount added to the cost price of goods to cover overhead and profit. It is usually expressed as a percentage of the cost price.

Front

How do you calculate the selling price using markup?

Back

Selling Price = Cost Price + (Markup Percentage × Cost Price).

Front

If a product costs $10 and has a 20% markup, what is the selling price?

Back

Selling Price = $10 + (0.20 × $10) = $12.

Front

What is a tip?

Back

A tip is a sum of money given to someone for their services, typically in the hospitality industry, as a reward for good service.

Front

How do you calculate a tip?

Back

Tip = Total Bill × Tip Percentage.

Front

If your dinner bill is $50 and you want to leave a 15% tip, how much is the tip?

Back

Tip = $50 × 0.15 = $7.50.

Front

What is a commission?

Back

A commission is a fee paid to an employee or agent for services rendered, usually calculated as a percentage of the sales they generate.

Front

How do you calculate commission?

Back

Commission = Total Sales × Commission Rate.

Front

If a salesperson sells $1,000 worth of products and earns a 10% commission, how much do they earn?

Back

Commission = $1,000 × 0.10 = $100.

Front

What is the difference between a tip and a commission?

Back

A tip is a voluntary payment for service, while a commission is a payment based on sales performance.