Question

1. The sweater buyer goes to another vendor looking for a promotion for Labor Day. He wants to sell cotton sweaters at a great price. The vendor offers him a one - time discount that allows him to purchase the sweaters at $12.50. Fill in the chart below with the appropriate retail that the buyer is considering. (round if you need to )

Item	Cost	Retail	IMU %
Cotton sweaters	$12.50		Keystone
	$12.50		Keystone + $2.00
	$12.50		52%

Answer 1

here, initial markup % (IMU%) keystone means :  50% initial markup (also known as IMU). It is also applying a 50% gross margin to the sale of the product.

therefore,

1. retail when cost is $12.50 and IMU% is keystone = 12.50 + 50% of 12.50

= 12.50 + 6.25 = 18.75.

2. retail when cost is $12.50 and IMU% is keystone + $2 =

12.50 + (50% of 12.50 +2)

= 12.50 + 8.25 = 20.75

3. retail when cost is $12.50 and IMU% is 52% = 12.50 + 6.5 = 19

Item	Cost	Retail	IMU %
Cotton sweaters	$12.50	18.75	Keystone
	$12.50	20.75	Keystone + $2.00
	$12.50	19	52%