HP 12C User manual

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HP 12C Cost, Price and Markup Calculations
Cost, price and markup concepts
How to calculate cost, price and markup on the HP12C
Practice solving cost, price and markup problems

hp calculators
HP 12C Cost, Price, and Markup Calculations
hp calculators - 2 - HP 12C Cost, Price, and Markup Calculations - Version 1.0
Cost, price and markup concepts
Items that are bought and sold have a cost to the seller and a price to the buyer. The difference between the cost and
the price is the gross amount the seller makes on the sale. There are two ways of computing the percentage this
difference represents. The term markup uses the cost as the basis for the percentage calculation while margin looks at
the price as the basis. The diagram in Figure 1 illustrates the relationship between cost and price.
Figure 1
The cost is the price minus a percent of the price called margin. The price can also be viewed as the cost plus a
percentage of the cost called markup. The following expressions relate margin, price and cost with each other.
100(%) ×






−
=
CS
T
CS
T
PRC
MU 




×
+=
100
(%) CSTMU
CSTPRC






+
=
100
(%)
1MU
PRC
CST
How to calculate cost, price and markup on the HP12C
The table below summarizes the keystroke sequence for each of the calculations above.
Unknown Keystroke
markup key in cost, \, key in price, à
price key in cost, \, key in markup, b+
cost key in price, \, 1, \, key in markup, b+z
Figure 2
Practice with solving interest rate conversion problems
Example 1: A television is sold for $300. Given that it costs $195, what is the markup?
Solution: The keystroke sequence to calculate the markup in this case is:
195 \ 300 à
Figure 3
cost merchandise
margin
mark-up
p
rice
%+
% -

hp calculators
HP 12C Cost, Price, and Markup Calculations
hp calculators - 3 - HP 12C Cost, Price, and Markup Calculations - Version 1.0
Answer: The markup is 53.85% for a $300 price given that is costs $195.
Example 2: The store manager wants to sell more TV sets and wants to reduce the price. If she cannot reduce the
markup below 40%, so what is the lowest price for this TV set? Assume the same $195 cost.
Solution: The keystroke sequence to calculate the lower price in this case is:
195 \ 40 b +
Figure 4
Answer: The lowest price for this TV set is $273 given a 40% markup and a $195 cost.
Example 3: Based on these figures, the store manager decides to sell the TV set for $289.99. What is the markup with
this price?
Solution: The following keystroke sequence calculates the markup with the new price:
195 \ 289.99à
Figure 5
Answer: With the new price, the applied markup is 48.71%.
Example 4: A new stereo system has a $150.75 sales price. Given a 53% markup for this stereo system, what must be
its cost?
Solution: The keystroke sequence to calculate the cost with these figures is:
150.75 \ 1 \ 53 b + z
Figure 6
Answer: The cost of this stereo system is $98.53.
Example 5: When calculating the price of a toaster, a 32% margin is expected on each sale. What is the markup to be
applied to the cost of a toaster to obtain this margin?

hp calculators
HP 12C Cost, Price, and Markup Calculations
hp calculators - 4 - HP 12C Cost, Price, and Markup Calculations - Version 1.0
Solution: The following keystroke sequence calculates the markup given a 32% margin:
32 \ \ 1 ~ b - z
Figure 7
Answer: A 47.06% markup is equivalent to a margin of 32%.