Problem 13-11 (IAA) Wholesome Company sold merchandise on a consignment basis to dealers. The gross profit was 25% above cost. The dealer is paid a 10% commission of the sales price for all sales made. All dealer sales are made on a cash basis. The following consignment activities occurred during the current year: Manufacturing cost of goods shipped on consignment Sales price of merchandise sold by dealers Payments remitted by dealers after deducting commission 8,800,000 9,600,000 6,300,000 What was the gross profit on 'consignment sales? a. 2,400,000 b. 1,920,000 c. 1,700,000 d. 1,220,000
Problem 13-11 (IAA) Wholesome Company sold merchandise on a consignment basis to dealers. The gross profit was 25% above cost. The dealer is paid a 10% commission of the sales price for all sales made. All dealer sales are made on a cash basis. The following consignment activities occurred during the current year: Manufacturing cost of goods shipped on consignment Sales price of merchandise sold by dealers Payments remitted by dealers after deducting commission 8,800,000 9,600,000 6,300,000 What was the gross profit on 'consignment sales? a. 2,400,000 b. 1,920,000 c. 1,700,000 d. 1,220,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Problem 13-11 (IAA)
Wholesome Company sold merchandise on a consignment
basis to dealers. The gross profit was 25% above cost.
The dealer is paid a 10% commission of the sales price for
all sales made. All dealer sales are made on a cash basis.
The following consignment activities occurred during the
current year:
Manufacturing cost of goods shipped on consignment
Sales price of merchandise sold by dealers
Payments remitted by dealers after deducting
commission
8,800,000
9,600,000
6,300,000
What was the gross profit on 'consignment sales?
a. 2,400,000
b. 1,920,000
c. 1,700,000
d. 1,220,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3357cb63-47da-48e9-88e7-60e7f8a3c4b5%2Ff821cc7c-7bb7-48c6-9018-5ead55d465b2%2F1sdg0d4_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Problem 13-11 (IAA)
Wholesome Company sold merchandise on a consignment
basis to dealers. The gross profit was 25% above cost.
The dealer is paid a 10% commission of the sales price for
all sales made. All dealer sales are made on a cash basis.
The following consignment activities occurred during the
current year:
Manufacturing cost of goods shipped on consignment
Sales price of merchandise sold by dealers
Payments remitted by dealers after deducting
commission
8,800,000
9,600,000
6,300,000
What was the gross profit on 'consignment sales?
a. 2,400,000
b. 1,920,000
c. 1,700,000
d. 1,220,000
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