A furniture store marks its items at 80% above the cost price. They offer a discount of 30% on the marked price. If a customer receives an additional loyalty discount of ₹250, and the store still makes a 12% profit on the cost price, what is the cost price of the furniture item?
Show answer & explanation
Correct answer: A
Explanation
The correct answer is option 1 i.e. ₹1,785.71.
Let cost price = C
Marked price = 1.8C
Selling price before loyalty discount = 0.7 × 1.8C = 1.26C
Final selling price = 1.26C – 250
1.12C = 1.26C – 250
⇒ 1.26C – 1.12C = 250
⇒ 0.14C = 250
⇒ C = 250/0.14 = 1785.714... ≈ 1785.71