During 2017 Sage Furniture Company purchases a carload of wi

During 2017, Sage Furniture Company purchases a carload of wicker chairs. The manufacturer sells the chairs to Sage for a lump sum of $54,900 because it is discontinuing manufacturing operations and wishes to dispose of its entire stock. Three types of chairs are included in the carload. The three types and the estimated selling price for each are listed below.

Type
No. of Chairs
Estimated Selling
Price Each
Lounge chairs 300 $90
Armchairs 300 80
Straight chairs 800 50

During 2017, Sage sells 150 lounge chairs, 120 armchairs, and 110 straight chairs.

What is the amount of gross profit realized during 2017? What is the amount of inventory of unsold straight chairs on December 31, 2017? (Round cost per chair to 2 decimal places, e.g. 78.25 and final answer to 0 decimal places, e.g. 5,845.)

Gross profit realized during 2017
$
[Entry field with incorrect answer] 37641
Amount of inventory of unsold straight chairs
$
[Entry field with incorrect answer]

Solution

Let, All the chairs purchased has been sold off: Total sales would have been: Lounge chairs: 300*90 27000 Arm chairs 300*80 24000 Straight chairs 800*50 40000 Total sales would have been: 91000 less: Total c cost 54900 Gross margin 36100 Gross margin rate on sales 39.67% Gross profit per chair and Total Gross profit earned Chairs SP GP Number of chairs sold Gross profit Lounge chairs 90 35.703 150 5355.45 Arm chairrs 80 31.736 120 3808.32 Straight chairs 50 19.835 110 2181.85 Gross profit earned 11346 Ending inventory Chairs SP GP Cost price Unsold units Ending inventory Lounge chairs 90 35.703 54.297 150 8144.55 Arm chairrs 80 31.736 48.264 180 8687.52 Straight chairs 50 19.835 30.165 690 20813.85 Ending inventory 37646