During Its First Month of Operations,Purrfect Pets Purchased 6,000 Bags

question 171

Essay

During its first month of operations,Purrfect Pets purchased 6,000 bags of dog food at a cost of $5 a bag and sold all 6,000 bags of dog food on account with payment terms of 3/10,n/30 for $10 each.A total of 2,600 of these bags were sold to customers who paid within the discount period;the other customers paid after the discount period had ended.Sales allowances totaling $200 were granted to customers whose dogs did not like the dog food.
Required:
a.Calculate the gross profit for the month.
b.Calculate the gross profit percentage for the month.

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Definitions:

Market Segmentation

The practice of dividing a market into distinct groups of buyers with different needs, characteristics, or behaviors who might require separate products or marketing mixes.

Appraisals

The process of assessing the value, performance, or quality of an item or employee.

Exchange

The act of giving one thing and receiving another, especially of the same type or value, in return.

Things Of Value

Items, services, or concepts that hold worth or usefulness to individuals or organizations.