Chap 1 Knowledge Check Answer Key

Knowledge Check 1.1

1. a. $9,000        b.         $66,000
2. Sounders: $\frac{\$936,400}{\$184,000}$, Elecktronicks: $\frac{\$1,245,900}{\$209,400}$ (Elecktronicks is better)

Knowledge Check 1.2

1. a. Net Profit = 14% of $\$29,000=0.14\times \$29,000=\$4,060$.

b. $Sales\times 0.14=\$5,000$, so $Sales=\frac{\$5,000}{0.14}=\$35,714.29$

2 a. $9.80  b. $22.40  c. $39.20

Knowledge Check 1.3

1.a. COGS = 0.65 × $ 90,000 =   $58,500

2. $\text{Percent gross margin}=\frac{\$31,500}{\$90,000}=0.35=35$

Knowledge Check 1.4

Knowledge Check 1.5

1. a.

$\text{Math input error}$

b.

$\text{Math input error}$

Knowledge Check 1.6

1. $700(1-0.3)(1-0.25)=\$367.50$
2. Discount = $349-\$244.30=\$104.70$

$\text{Discount Rate}=\frac{\$104.70}{\$349}=0.30=30$

Knowledge Check 1.7

Before Discount: $6\times \$749(1-0.3)(1-0.05)=\$2,988.51$

After Discount: $2,988.51(1-0.03)=\$2,898.85$

Knowledge Check 1.8

1. The last day you can pay off both debts is the day the fridge invoice is due:  May 4.  On this day, the fridge will not get a discount, but the range will be eligible for a 5% discount
2. The first payment of $760 is worth a credit of:

$Credit=\frac{\$760}{(1-0.05)}=\$800$

so the we owe $\$2,500-\$800=\$1,700$ on the fridge, and $\$3,250(1-0.05)=\$3,087.50$ on the range, so our final payment will be:

$Payment=\$1,700+\$3,087.50=\$4,787.50$