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Suppose a certain car manufa "selling models offers a $8,000 extra dealer incentive for eaci these venicles that the dealen As the accountant for a dealership with a number of these vehicles left in stock, your manager has asked you to calculate certain invoice figures. The normal trade discount from this car manufacturer is 17%. If the average sticker price (list price) of these remaining vehicles at your dealership is S26,500, calculate the following. (a) What is the amount of the trade discount. including the incentive (in $)? (b) What is the trade discount rate (in percent)? Round to the nearest tenth of a percent. (c) what is the net price (invoice price) to your dealership (in $)? (d) If the cars were then sold from the fleets at $1.000 over "invoice" (net price), what is the totaercentage savings to the consumer based on the list price? Round to the nearest tenth of a percent. () Although these incentive prices reflect extraordinary discounts to the consumer, what other factors should a consumer consider before purchasing a"discontinued" brand of vehicle? (Select all that apply.) O total number of vehicles manufactured this year O vehicle will be worth less than comparable models that are not discontinued O net worth of the car dealership O availability of parts and service O vehicles may be more difficult to resell

Suppose a certain car manufa "selling models offers a $8,000 extra dealer incentive for eaci these venicles that the dealen As the accountant for a dealership with a number of these vehicles left in stock, your manager has asked you to calculate certain invoice figures. The normal trade discount from this car manufacturer is 17%. If the average sticker price (list price) of these remaining vehicles at your dealership is S26,500, calculate the following. (a) What is the amount of the trade discount. including the incentive (in $)? (b) What is the trade discount rate (in percent)? Round to the nearest tenth of a percent. (c) what is the net price (invoice price) to your dealership (in $)? (d) If the cars were then sold from the fleets at $1.000 over "invoice" (net price), what is the totaercentage savings to the consumer based on the list price? Round to the nearest tenth of a percent. () Although these incentive prices reflect extraordinary discounts to the consumer, what other factors should a consumer consider before purchasing a"discontinued" brand of vehicle? (Select all that apply.) O total number of vehicles manufactured this year O vehicle will be worth less than comparable models that are not discontinued O net worth of the car dealership O availability of parts and service O vehicles may be more difficult to resell

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter17: Advanced Issues In Revenue Recognition
Section: Chapter Questions
Problem 15RE: GameDay sells recreational vehicles along with secure parking storage to customers. Game Day sells...
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Suppose a certain car manufacturer's incentive program designed to reduce inventory of certain low-selling models offers a $8,000 extra dealer incentive for each of these vehicles that the dealer moved into its rental or service fleets. As the accountant for a dealership with a number of these vehicles left in stock, your manager has asked you to calculate certain invoice figures. The normal trade discount from this car manufacturer is 17%. If the average sticker price (list price) of these remaining vehicles at your dealership is $26,500, calculate the following. (a) What is the amount of the trade discount, including the incentive (in $)? (b) What is the trade discount rate (in percent)? Round to the nearest tenth of a percent. (c) What is the net price (invoice price) to your dealership (in $)? (d) If the cars were then sold from the fleets at $1,000 over "invoice" (net price), what is the totapercentage savings to the consumer based on the list price? Round to the nearest tenth of a percent. (e) Although these incentive prices reflect extraordinary discounts to the consumer, what other factors should a consumer consider before purchasing a "discontinued" brand of vehicle? (Select all that apply.) O total number of vehicles manufactured this year O vehicle will be worth less than comparable models that are not discontinued net worth of the car dealership O availability of parts and service vehicles may be more difficult to resell ASK YOUR TEACHER %24
Transcribed Image Text:Suppose a certain car manufacturer's incentive program designed to reduce inventory of certain low-selling models offers a $8,000 extra dealer incentive for each of these vehicles that the dealer moved into its rental or service fleets. As the accountant for a dealership with a number of these vehicles left in stock, your manager has asked you to calculate certain invoice figures. The normal trade discount from this car manufacturer is 17%. If the average sticker price (list price) of these remaining vehicles at your dealership is $26,500, calculate the following. (a) What is the amount of the trade discount, including the incentive (in $)? (b) What is the trade discount rate (in percent)? Round to the nearest tenth of a percent. (c) What is the net price (invoice price) to your dealership (in $)? (d) If the cars were then sold from the fleets at $1,000 over "invoice" (net price), what is the totapercentage savings to the consumer based on the list price? Round to the nearest tenth of a percent. (e) Although these incentive prices reflect extraordinary discounts to the consumer, what other factors should a consumer consider before purchasing a "discontinued" brand of vehicle? (Select all that apply.) O total number of vehicles manufactured this year O vehicle will be worth less than comparable models that are not discontinued net worth of the car dealership O availability of parts and service vehicles may be more difficult to resell ASK YOUR TEACHER %24
Expert Solution
Step 1 (A)

AMOUNT OF THE TRADE DISCOUNT , INCLUDING THE INCENTIVE :

PARTICULATR AMOUNT AMOUNT
PRICE 26500  
- TRADE DISCOUNT @ 17% (4505) 4505
+ INCENTIVE SCHEME   8000
TOTAL   12505

 

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