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Please help, on the pilot question for December 2014 f7 exam, I don’t understand the working 1 day arrived at the $1,600 day was deducted from the revenue figure. Why did we multiply by 100/75?
When it is 25% margin we therefore multiply it by100/75 whereas for mark up it is 25/125
Where a question tells you something like “the cost of this service was $1,200 and the company normally achieves a 25% margin on this type of service” then the cost of the service must be 75% of the invoiced value
That’s why we have to gross it up
Check out the mini-exercises towards the end of the free course notes – there are lots of examples of mark up and margin questions
Waleed, your assistance was not particularly helpful!
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