Question

Legal Seafoods catches and processes salmon. In January 2020, it placed 100 wild salmon with a retail price of $75 each in Boston Fish Shop. According to Legal’s contract, Boston Fish will earn a 15% commission on each salmon sold. Boston Fish is responsible for purchasing any fish that remain unsold after three days. During the three-day period, Boston Fish sold 75 of the 100 salmon. How much revenue should Legal Seafoods recognize with respect to this

a.
$3,750

b.
$7,500

c.
$1,875

d.
$0

e.
$5,625

Answer 1

Answer: b) $7500

Explanation:

Legal sea foods sales = $75 x 100 = $7500

After sale of salmon from Leagal sea foods to Boston Fish there is no responsibility on the Legal sea foods if any unsold.

If there is any unsold fishes the Boston Fish is responsible for that.

Therefore, the revenue of the Legal sea foods = $7,500

Thus, Option b) is correct and remaining given options are incorrect