The selected answer is not exactly the correct one. Suppose Mallcentral sells 1,
ID: 2555715 • Letter: T
Question
The selected answer is not exactly the correct one.
Suppose Mallcentral sells 1,300 hardcover books per day at an average price of S60. Assume that Mallcentral's cost for the books is 85% of the selling price it charges retail customers. Malcentral has no beginning inventory, but it wants to have a three-day supply of ending inventory. Assume that selling and administrative expenses are $2,600 per day. Determine Mallcentral's budgeted purchases for the next (seven-day) week. O A. $780,000 OB. $663,000 O C. $265,200 ?D. $464,100Explanation / Answer
Calculation of purchases in units
Sales per day
1,300
sales per week
9,100
Add: closing stock required for 3 days
3,900
Total purchase units (9,100+3,900) (A)
13,000
Selling price per unit
$60
Cost per unit (85% of $60) (B)
$51
Purchases (A*B) = (13,000*$51)
$663,000
Ans
Option (B) $663,000 is correct
Calculation of purchases in units
Sales per day
1,300
sales per week
9,100
Add: closing stock required for 3 days
3,900
Total purchase units (9,100+3,900) (A)
13,000
Selling price per unit
$60
Cost per unit (85% of $60) (B)
$51
Purchases (A*B) = (13,000*$51)
$663,000
Ans
Option (B) $663,000 is correct
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