Question

On May 3, 2017, Oriole Company consigned 90 freezers, costing $520 each, to Remmers Company. The cost of shipping the freezers amounted to $820 and was paid by Oriole Company. On December 30, 2017, a report was received from the consignee, indicating that 45 freezers had been sold for $690 each. Remittance was made by the consignee for the amount due after deducting a commission of 6%, advertising of $210, and total installation costs of $340 on the freezers sold. (Round answers to 0 decimal places, e.g. 5,275.) (a) Compute the inventory value of the units unsold in the hands of the consignee. Inventory value $Entry field with incorrect answer now contains modified data (b) Compute the profit for the consignor for the units sold. Profit on consignment sales $Entry field with incorrect answer (c) Compute the amount of cash that will be remitted by the consignee. Remittance from consignee

Answer 1

Answer
Answer A	(A)Total units consigned =90 x $ 5200 = $ 46800
	Transportation Cost for 90 units = $ 820
	Total Cost for 90 units consigned = $ 47620
	Cost Per Unit ($ 47620/90 units) = $ 529.11
	Number of Units unsold = 45 freezers
	Cost of unsold inventory (45 x $ 529.11) = $ 23810
Answer B	(B) Sales proceeds (45 x $ 690) = $ 31050
	Less : Commission deducted @ 6% = $ 1863
	Less : Advertising = $ 210
	Less : Installation cost = $ 340
	Net Proceeds = $ 28637
	Less : Cost of 45 units (45 x $ 529.11)= $ 23810
	Profit on sale of 30 freezers   = $ 4827
Answer C	Sales proceeds (45x $ 690) = $ 31050
	Less : Commission deducted @ 6% = $ 1863
	Less : Advertising = $ 210
	Less : Installation cost = $ 340
	Net Proceeds remitted by consignee = $ 28637