On May 3, 2014, Eisler Company consigned 82 freezers, costing $450 each, to Remm

Question

On May 3, 2014, Eisler Company consigned 82 freezers, costing $450 each, to Remmers Company. The cost of shipping the freezers amounted to $790 and was paid by Eisler Company. On December 30, 2014, a report was received from the consignee, indicating that 41 freezers had been sold for $780 each. Remittance was made by the consignee for the amount due, after deducting a commission of 7%, advertising of $150, and total installation costs of $300 on the freezers sold.

(a) Compute the inventory value of the units unsold in the hands of the consignee.

(b) Compute the profit for the consignor for the units sold.

(c) Compute the amount of cash that will be remitted by the consignee.

Explanation / Answer

consigned 82 freezers costing 450 each total freezers cost 36900 cost of shipping 790 total cost 37690 a)inventory value of unsold 18845 Sales 41 freezers sales price 780 each Total sales 31980 Commision 2238.6 Advertising 150 Installation cost 300 c) Amount sent by consignee 29291.4 Less: cost of freezer 18450 Less: Prop cost of shipping 395 b) Profit 10446.4

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