Question

Slotnick Chemical received $230,000 from customers as deposits on returnable containers during 2018. Ten percent of the containers were not returned. The deposits are based on the container cost marked up 10%. How much profit did Slotnick realize on the forfeited deposits?

Answer 1

Answer:

$20,909.09

Explanation:

We have been given that Slotnick Chemical received $230,000 from customers as deposits on returnable containers during 2018. 10% of the containers were not returned. The deposits are based on the container cost marked up 10%.

The price after mark-up would be $100\%+10\%=110\%$

To find the profit on the forfeited deposits, we will divide $230,000 times 10% by 110% as:

$\text{Profit on the forfeited deposits}=\frac{\ 230,000\times 10\%}{110\%}$

$\text{Profit on the forfeited deposits}=\frac{\ 230,000}{11}$

$\text{Profit on the forfeited deposits}=\ 20,909.0909$

$\text{Profit on the forfeited deposits}\approx \ 20,909.09$

Therefore, Slotnick realize a profit of $20,909.09 on the forfeited deposits.