Bell, Inc. buys 1,300 computer game CDs from a distributor who is discontinuing

Question

Bell, Inc. buys 1,300 computer game CDs from a distributor who is discontinuing those games. The purchase price for the lot is $12,400. Bell will group the CDs into three price categories for resale, as indicated below

Group

No. of CDs   

Price per CD

1 300 $6

2 800 $12

3 200 $19

Determine the cost per CD for each group, using the relative sales value method. (Do not round ratios for computational purposes and round final answers to 2 decimal places, e.g. 5.85.)

Group 1, 2, 3 , Cost per CD $ ?

Group

No. of CDs   

Price per CD

Explanation / Answer

Group Number of CDs Price Per CD Sale Value Cost on the basis of relative sales Cost Per CD 1 300 6 1800                                                      1,468.42                                   4.89 2 800 12 9600                                                      7,831.58                                   9.79 3 200 19 3800                                                      3,100.00                                 15.50 Total 15200                                                   12,400.00

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