**Q: How do you find the cost price if the sales are $216,000 and the mark-up is 50%?**

A:

In an equation this simplifies to:

Mark-up (profit) / cost = 50/100 (50% of cost)

Selling price = cost + profit (mark-up)

Selling price = 100%+50%

Selling price = 150%

Therefore cost = 100/150 X $216,000 = $144,000

Hope that helps you understand the differences between cost price, sales price and mark-up.

Check out the comments below for more questions about this topic.

- What is Inventory?
- Sales, Cost of Goods Sold and Gross Profit
- Perpetual and Periodic Inventory Systems
- FIFO, LIFO and the Weighted Average Cost Method

Founder of Accounting Basics for Students

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