Question

A producer, earning a profit of `12%`, earns `$540` on a product. What is the cost price and sale price of the product?

Answer 1

(a) Cost price is `4500` and (b) Sale price is `5040`.

Explanation:

As profit is calculated on cost price,

if `12%` is `540`, cost price will be equivalent to `100%`

Hence cost price is`540/12xx100=45xx100=4500`

and sale price being sum of cost price and profit

Sale price is `4500+540=5040`.

Answer 2

(1) A = `"$3960"` (This is the money it "costs" the producer/company to manufacture the product)

(2) A = `"$5040"` (This is the price the product is sold at)

Explanation:

First, let's start by finding the "cost" price or how much it costs the manufacture to produce the product. We do this by finding the total sale price and subtracting the profits.

= `4500 - 540`
= `3960`

Then, we can calculate the sale price which is just the total percentage + profit:

= `4500 + 540`
= `$5040`

All the best!