Question

Company expects to sell 360,000 units at $20. There are about $56,000 worth of goods that will be returned and customers usually avail of the 2% sales discount. Estimated NET sales is must be _.

Answer 1

To estimate net sales, calculate 360,000 units × $20, subtract returns of $56,000, and a 2% sales discount on the remaining amount to find an estimated net sales of $7,001,120.

Step-by-step explanation:

To calculate the estimated net sales for a company expecting to sell 360,000 units at $20 each, we first calculate the gross sales and then deduct the anticipated goods returns and sales discounts. The gross sales would be 360,000 units × $20/unit = $7,200,000. From the gross sales, we subtract the value of goods expected to be returned, which is $56,000, and the sales discount. The sales discount is 2% of the gross sales (excluding returns), so we find 2% × ($7,200,000 - $56,000) = 2% × $7,144,000 = $142,880. Finally, to find the net sales, we deduct both the value of goods returned and the sales discount from the gross sales: $7,200,000 - $56,000 - $142,880 = $7,001,120 is the estimated net sales.