Question

If the manufacturer gains \[10%\], the wholesale dealer \[15%\] and the retailer \[25%\], then find the cost of production of a table the retail price of which is \[Rs.1265\].
A. 600
B. 800
C. 700
D. 900

Answer 1

Hint: Find the gain of the manufacturer, wholesale and the retailer. Take the cost of production as ‘x’. Find the cost of production by substituting all these values.

Complete step-by-step answer:
The question is about the production of a table. We have to find out the cost of production of the table.
Let us consider the cost of production of table as Rs. ‘x’.
It is said that the manufacturer gains \[10%\].
The wholesale dealer gains \[15%\] and the retailer gains \[25%\].
The retail price will be taken as 100% of \[Rs.1265\].
Then the manufacturer gains \[10%\]. Thus the manufacturer sells it for \[(100+10)%\] of the manufacturing price \[=110%\] of Rs. x.
Similarly the wholesale dealer gains \[15%\].Thus the wholesale dealer sells it at \[(100+15)%\] of the price he paid to the manufacturer \[=115%\] of \[110%\] of Rs. x.
The retailer gains 25%. Thus the retailer sells it at \[(100+25)%\] of the price he paid to the wholesale dealer \[=125%\] of \[115%\] of \[110%\] of Rs. x.
We have been given the retail price of the table as \[Rs.1265\].
Hence by the problem, we need to find the value of x.
\[125%\] of \[115%\] of \[110%\] of \[x=Rs.1265\]
By solving the above expression, we get the cost of production of a table.
\[\dfrac{110}{100}\times \dfrac{115}{100}\times \dfrac{125}{100}\times x=1265.\]
Rearranging and cross multiplying the above expression we get,
\[x=\dfrac{1265\times 100\times 100\times 100}{110\times 115\times 125}.\]
Solve the above expression and get the value of x.
\[x=Rs.800\]
Hence we got the cost of production of a table as \[Rs.800\].
Note: We are given the retail price as \[Rs.1265\] and not the original cost of production. The retail prices are the price that the custom buying goods at retail outlets pay. Thus find the original cost of the table after cancelling out the gains from the retail price.