Question

CatManDoo sold 4,500 bags of kitty litter during the month of June at a price of $10/bag. The company offers a full refund to unsatisfied customers for any product returned within 30 days from the date of purchase. Based on historical experience, Aria expects that 2% of sales will be returned. How much revenue should CatManDoo recognize in June?

Answer 1

$44,100

Step-by-step explanation:

Given that,

Number of bags sold during the month of June = 4,500

Selling price of each bag = $10

Expects percentage of sales returned = 2% of sales

Total revenue = Sales - Sales returned

= (4,500 × $10) - (2% × 4,500 × $10)

= $45,000 - $900

= $44,100

Therefore, the revenue should CatManDoo recognize in June is $44,100.