Financial accounting A retailer purchases an item for $100 and sells it at a priceof $175.a. What is the margin?b. What is the retail margin as a percentage of cost and what isthe retail margin as a percentage of the selling price?

Step 1:a. The margin is calculated as follows: Margin = Selling price - Purchase cost =…

Answered: A retailer purchases an item for $100…

College Accounting (Book Only): A Career Approach

13th Edition

ISBN:9781337280570

Author:Scott, Cathy J.

Publisher:Scott, Cathy J.

Chapter10: Cash Receipts And Cash Payments

Section: Chapter Questions

Problem 1DQ: What is the normal balance for each of the following accounts: (a) Purchases? (b) Sales Discounts?...

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Mar. Stellar Stores purchases $8,500 of merchandise for resale from Blossom Wholesalers, terms 2/10, n/30, FOB shipping point. The correct company pays $135 for the shipping charges. Stellar returns $1,000 of the merchandise purchased on March 1 because it was the wrong colour. Blossom gives Stellar a 3 $1,000 credit on its account. Stellar Stores purchases an additional $11,500 of merchandise for resale from Blossom Wholesalers, terms 2/10, n/30, 21 FOB destination. 22 The correct company pays $155 for freight charges. Stellar returns $300 of the merchandise purchased on March 21 because it was damaged. Blossom gives Stellar a $300 23 credit on its account. 30 Stellar paid Blossom the amount owing for the merchandise purchased on March 1. 31 Stellar paid Blossom the amount owing for the merchandise purchased on March 21. Additional information: Mar. Blossom's cost of the merchandise sold to Stellar was $3,800. 1 Blossom's cost of the merchandise returned by Stellar was $447. As the…

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A retailer purchases an item for $100 and sells it at a price of $175. a. What is the margin? b. What is the retail margin as a percentage of cost and what is the retail margin as a percentage of the selling price?