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UI Post-UTME Commerce 2025 (Model questions) Question 20

Question 20

Business Calculations

A trader buys goods for ₦240,000, incurs freight charges of ₦12,000, and sells at a mark-up of 33⅓% on cost. Which of the following are CORRECT?
I. Total cost of goods = ₦252,000
II. Selling price = ₦336,000
III. Gross profit = ₦84,000
IV. Gross profit margin on sales = 25%

  1. A.I, III and IV only
  2. B.I and II only
  3. C.II and IV only
  4. D.All of the above
Show the answer and explanation

Answer: D (All of the above)

Explanation

Cost = 240,000 + 12,000 = ₦252,000. Mark-up = ⅓ × 252,000 = ₦84,000, so selling price = ₦336,000 and margin = 84,000 ÷ 336,000 = 25%. All four are true.