A contract merchant specializing in stationery articles sold a consignment of articles for and office. the sale price was $22,650 with commission rate of 16% for office articles. For this consignment, There was $650 freight that the merchant had to pay. What were the net proceeds due to the office?
To determine the net proceeds due to the office, we need to subtract the commission and the freight cost from the total sale price.
1. Calculate the commission amount:
Multiply the sale price by the commission rate:
Commission = Sale price x Commission rate
Commission = $22,650 x 0.16
Commission = $3,624
2. Determine the net sale price:
Subtract the commission amount from the sale price:
Net sale price = Sale price - Commission
Net sale price = $22,650 - $3,624
Net sale price = $19,026
3. Deduct the freight cost:
Subtract the freight cost from the net sale price:
Net proceeds due to the office = Net sale price - Freight cost
Net proceeds due to the office = $19,026 - $650
Net proceeds due to the office = $18,376
Therefore, the net proceeds due to the office amount to $18,376.