Question 19

A watch dealer pays 10% customs duty on a watch which costs Rs.500 abroad. He desires to make a profit of 20% after giving a discount of 25% to the buyer, The marked price should be

Solution

cost price (CP) of watch = cost + custom duty

CP = 500 + $$\frac{10}{100} \times$$500 = 500 + 50 = 550

profit = 20%

profit = $$\frac{profit percent}{100} \times$$CP = $$\frac{20}{100} \times$$550 = 110

selling price (SP) = CP + profit

SP = 550+110 = 660

discount = 25%

SP = 75% of MP {MP= marked price}

660 = 75% of MP

MP = $$\frac{660}{75} \times$$100 = 880

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