Question

Faye, George, and Hannah are salespeople working at Lasht Cellular. It costs Lasht Cellular $21.49 per phone to stock a certain brand of phone, which they sell for $68.75. The three salespeople earn differing amounts of commission per phone sold, based on their seniority. The following table shows their respective sales in the past month.
Salesperson
Phones Sold
Commission/Phone
Faye
214
$10.25
George
176
$8.90
Hannah
251
$9.65

If Lasht Cellular had fixed overhead costs of $14,350 last month, how much profit did it gain last month?
a.
$9,761.61
b.
$15,943.66
c.
$22,125.71
d.
$23,536.70

Answer 1

A. 9,761.61 is the correct answer to this question

Answer 2

In order to get the profit, we must compute first the fixed cost
Fixed cost = storage cost + overhead cost
storage cost = total phones x storage fee
                       = (214+176+251) x$21.49
                       =$13775.09
fixed cost =$13775.09+$14350
                 = $28125.09
Next we compute the net sales
net sales = total sales - commision
total sales = 641 x$68.75 =$44068.75
commision= (214x$10.25)+(176x$8.9)+(251x$9.65)
                   =6182.05
net sales = $44068.75-6182.05 =$37886.7
profit = net sales- fixed cost
profit = $37886.7-$28125.09
profit = $9761.61 
The profit for Lasht cellular is $9761.61