Markup and Markdown

Markup is the amount added to the cost price of a product to determine its selling price. It is usually expressed as a percentage of the cost price.

Markdown is a reduction in the original selling price of a product. It is often used to encourage sales and clear out inventory.

Final Price = Original Price + (Original Price × Sales Tax Rate).

Selling Price = $100 + ($100 × 0.10) = $110.

Amount Paid = Original Price - (Original Price × Discount Rate) = $85 - ($85 × 0.40) = $51.

Original Price = Sale Price / (1 - Discount Rate).

Sales Tax Amount = Purchase Price × Sales Tax Rate.

Original Price = Sale Price / (1 - Discount Rate) = $799 / (1 - 0.20) = $998.75.

Sales Tax = $899 × 0.065 = $58.44.

A 20% discount means that the price is reduced by 20% of the original price.