Flashcards
Chapter 8 Key Terms
Cards in this deck (18)
- 1Breakeven PointPoint at which seller has covered all expenses and costs and has made no profit or suffered a loss
- 2Contribution MarginDifference between selling price and variable cost
- 3CostPrice retailers pay to manufacturer or supplier to bring merchandise into store
- 4Dollar MarkdownOriginal selling price less the reduction to price. Markdown may be stated as a percent of the original selling price.
- 5Dollar MarkupSelling price less cost. Difference is the amount of the markup. Markup is also expressed in percent.
- 6Fixed CostCosts that do no change with increase or decrease in sales
- 7Gross ProfitDifference between cost of bringing goods into the store and selling price of the goods
- 8MarginDifference between cost of bringing goods into store and selling price of goods
- 9MarkdownsReductions from original selling price caused by seasonal changes, special promotions, and so on.
- 10MarkupAmount retailers add to cost of goods to cover operating expenses and make a profit
- 11Net Profit (Net Income)Gross Profit-Operating Expenses
- 12Operating Expenses (Overhead)Regular expenses of doing business. These are not costs
- 13Percent Markup on CostDollar markup divided by the cost; thus, markup is a percent of the cost
- 14Percent Markup on Selling PriceDollar markup divided by the selling price; thus, markup is a percent of the selling price
- 15PerishablesGoods or services with a limited life
- 16Selling PriceCost plus markup equals selling price
- 17Variable CostCosts that do change in response to change in volume of sales
- 18Overhead ExpensesOperating expenses not directly associated with a specific department or product
Information
- Description
- Chapter 8 of Practical Business Math Procedures goes over selling goods and prices. It discusses break even points, costs, markups, and other margins. It explains how we get selling prices and why companies charge what they do.
- Created by
- Laney Feek
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