A wholesaler sells a batch of goods for $1200, which includes a profit of 20%. W

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Question: A wholesaler sells a batch of goods for $1200, which includes a profit of 20%. What was the cost price of the goods?

Options:

Correct Answer: $1000

Solution:

Let the cost price be x. Selling Price = x + 20% of x = 1.2x. Thus, 1.2x = 1200, so x = 1000.

A wholesaler sells a batch of goods for $1200, which includes a profit of 20%. What was the cost price of the goods?

A wholesaler sells a batch of goods for $1200, which includes a profit of 20%. What was the cost price of the goods?

Step 1: Understand that the wholesaler sells goods for $1200, which includes a profit of 20%.
Step 2: Let the cost price of the goods be represented by 'x'.
Step 3: Since there is a profit of 20%, the selling price can be expressed as the cost price plus 20% of the cost price. This can be written as: Selling Price = x + 0.2x.
Step 4: Combine the terms: Selling Price = 1.2x.
Step 5: We know the selling price is $1200, so we can set up the equation: 1.2x = 1200.
Step 6: To find 'x', divide both sides of the equation by 1.2: x = 1200 / 1.2.
Step 7: Calculate the value: x = 1000.
Step 8: Therefore, the cost price of the goods is $1000.

Profit Calculation – Understanding how to calculate profit as a percentage of the cost price and how it relates to the selling price.
Algebraic Manipulation – Using algebra to solve for the unknown variable (cost price) in an equation derived from the selling price.