Answer:
A. $16,195
B. $7,621
C. $23,816
Explanation:
a. Computation for the inventory value of the units unsold in the hands of the consignee.
Inventory value of the units unsold
First step is to calculate the Total inventory value
Inventory cost $31,500
(70 * $450)
Add Freight $890
Total inventory value $32,390
($31,500+$890)
Now let calculate the Inventory value of the units unsold
Inventory value of units unsold =($32,390 / 2)
Inventory value of units unsold =$16,195
Therefore the inventory value of the units unsold in the hands of the consignee is $16,195
b. Computation for the profit for the consignor for the units sold
Sales $25,900
(35 * $740)
Less Cost of unit sold ($16,195)
($32,390 / 2)
Less Commission ($1,554)
($25,900 * 6%)
Less Advertising ($200)
Less Installation cost ($330)
Profit for the consignor $7,621
Therefore the profit for the consignor for the units sold will be $7,621
c. Computation for the amount of cash that will be remitted by the consignee.
Sales $25,900
Less Commission ($1,554)
($25,900 * 6%)
Less Advertising ($200)
Less Installation cost ($330)
Cash remitted $23,816
Therefore the amount of cash that will be remitted by the consignee is $23,816
