Question

Kevin works for a company which produces printers. A printer sells for $163.95 and costs $48.28 to produce. In one month, Kevin’s company sold 427 printers, earning a profit of 22,599.09. How great were the company’s non-production overhead expenses, to the nearest dollar?

a) $13,410
b) $20,616
c) $24,809
d) $26,792

Answer 1

Option D $26,792

Explanation:

When producing 427 printers, the cost of production is 427*$48.28=$20,615.56

When selling each printer, profit per printer is $163.95 - $48.28= $115.67

Total money after selling the 427 printers is 427*$163.95 =$70006.65

Subtracting cost of production from value of sales we deduce

$70006.65-$20,615.56=$49391.09

Non-profit overhead expenses will be the difference between the expected profit and the actual profit earned

$49391.09 -$22,599.09.=$26,792

Therefore, option D, $26,792 is the right choice