In Order to Encourage Canadians to Avoid Cross Border Shopping

question 194

Multiple Choice

In order to encourage Canadians to avoid cross border shopping, Walmart Canada is striving to keep the price of electronics in Canada equivalent to the price of electronics in its US stores before taxes. If a TV is sold for $700 in US stores, what should be the sale price of the same TV in Canadian stores? Use the exchange rate of US$0.966 per C$.

• A) $700
• B) $724.64
• C) $676.20
• D) $641.27
• E) $619.47

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Definitions:

Materials Costs

The expenses associated with the raw materials used in the manufacturing of products or goods.

Canning Department

A section within a manufacturing process focused on the preservation of food by sealing it in airtight containers.

Weighted-Average Method

An inventory costing method that calculates the cost of goods sold and ending inventory based on the average cost of all goods available for sale.

Direct Materials Cost

Direct materials cost refers to the cost of raw materials and components that are directly used in the production of a product, which are easily traceable to the finished product.