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adoni [48]
2 years ago
12

Fall Co. paid $500 in freight-out charges to ship $25,000 of inventory on consignment to Rodgers Co. Rodgers printed and mailed

customer promotions for the merchandise at a cost of $250, reimbursable from Fall. At the end of the year, 80% of the inventory was sold for $40,000. The agreement states that commission of 25% will be provided to Rodgers for all sales. What amount of net inventory on consignment remains on the balance sheet at the end of the year for Fall?
Business
1 answer:
Aloiza [94]2 years ago
6 0

Answer:

$5100

Explanation:

The cost of the inventory in $25000 and the cost of shipping it to the consignee, $500.

The cost of marketing brochures an comissions are recognized as expense and do not affect inventory.  If 80% of the inventory was sold, 20% remains, which will have a carrying value of $25,500 X 20% = $5100

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<h3>Budgeted total expense</h3>

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