Saturday, June 25, 2011

What are the estimated total costs if Penny’s expects to sell 3,000 units next year?

ACCOUNTING

Multiple Choice

Penny’s TV and Appliance Store is a small company that has hired you to perform some management advisory services. The following information pertains to 20x3 operations.



Sales (2,000 televisions) $ 900,000

Cost of goods sold 400,000

Store manager's salary per year 70,000

Operating costs per year 157,000

Advertising and promotion per year 15,000

Commissions (4% of sales) 36,000



What are the estimated total costs if Penny’s expects to sell 3,000 units next year?

a. $896,000

b. $678,000

c. $1,017,000

d. $799,000

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