Use the following information for the next two questions: ABC Co. bills its branch for merchandise at 140% of cost. At the end of its first month, the branch submitted the following data: Merchandise from home office (at billed price) 98,000 Merchandise purchased locally by branch 40,000 Inventory, December 31 of which 7,000 are of local purchase 28,000 Net sales for the month 180,000 How much is the branch’s ending inventory at cost? a. 92,000 b. 20,000 c. 22,000 d. 23,800 How much is the branch’s gross profit in so far as the home office is concerned? a. 70,000 b. 72,000 c. 90,000 d. 92,000
Use the following information for the next two questions:
ABC Co. bills its branch for merchandise at 140% of cost. At the end of its first month, the branch submitted the following data:
Merchandise from home office (at billed price) 98,000
Merchandise purchased locally by branch 40,000
Inventory, December 31 of which 7,000 are of local purchase 28,000
Net sales for the month 180,000
How much is the branch’s ending inventory at cost?
a. 92,000 b. 20,000 c. 22,000 d. 23,800
How much is the branch’s gross profit in so far as the home office is concerned?
a. 70,000 b. 72,000 c. 90,000 d. 92,000
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