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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