Mathematics for Business and Personal Finance

Chapter 14: Purchasing and Inventory

Practice Tests

1
A customer places a special order through Keystone Furniture Store. The list price in the manufacturer's catalog is $1,600. Keystone Furniture receives a 35% trade discount. What is the net price for the furniture order?
A)$560
B)$1,040
C)$1,535
D)$1565
2
The Scrap Book Shop is purchasing a supply of paper. The list price in the wholesaler's catalog is $32.50 per pack. The Scrap Book Shop receives a 40% trade discount. What is the net price?
A)$13.00
B)$19.50
C)$21.75
D)$45.50
3
Tag Manufacturing offers discounts on most of its products. What is the trade discount rate on an item with a list price of $16.79 and a net price of $12.42?
A)22%
B)26%
C)54%
D)74%
4
The list price of a sewing machine is $495. A fabric store purchases a machine. They receive a 40% discount. What is the net price of the machine using the complement method?
A)$198
B)$297
C)$435
D)$455
5
The list price of a gallon of paint is $32. The trade-discount rate is 30%. What is the net price of a gallon of paint using the complement method?
A)$9.60
B)$22.40
C)$32.10
D)$41.60
6
ALGEBRA The Canon Catalog Outlet offers a trade-discount rate that is 3 times its complement. If the net price is $15.30, what is the list price?
A)$19.13
B)$25.00
C)$61.20
D)$76.40
7
Chain-Sawz is discontinuing its lower-end model chain saw which is priced at $219. Chain-Sawz is offering a chain discount on the saw of 20% less 10%, also written as 20/10. What is the final net price of the saw?
A)$4.38
B)$65.70
C)$153.33
D)$157.68
8
LawnTender manufactures weed wackers which are priced at $99. A new model is ready for production, so the old model will be discontinued. Find the net price of the model with a chain discount of 25% less 15%, also written 25/15.
A)$3.71
B)$39.60
C)$59.40
D)$63.11
9
Color Your World received an invoice for 144 gallons of paint dated July 7. The terms on the invoice read "2/10, net 30." What is the last date to pay the invoice?
A)July 17
B)July 31
C)August 6
D)August 7
10
An invoice from the Toy Store shows a net price of $12,789.21. The terms are 4/15, n/40. The invoice is dated August 18. The invoice is paid September 3. How much is paid on September 3?
A)$12,789.21
B)$12,277.64
C)$11,425.67
D)$10,870.83
11
Kerri's Market received an invoice from Anna's Bakery dated August 27. The terms are 5/10 EOM. What is the last day to pay the invoice?
A)September 1
B)September 6
C)September 10
D)September 30
12
An invoice dated November 8 has terms of 2/10 EOM. Net price is $7,200. The invoice is paid December 3. How much is paid on December 3?
A)$7,200.00
B)$7,056.00
C)$6,350.40
D)$6,120.30
13
Under the Weather had 87 umbrellas in stock on March 1. During March, they received 50 and sold 98. Find the total inventory on April 1.
A)39
B)105
C)137
D)185
14
On January 1, Plastics Plus started with an inventory of 186 plastic storage bins. Shipments of 23, 56, and 35 were sent out and receipts of 23, 45, and 66 were received. Find the number on hand at the end of the month.
A)52
B)72
C)186
D)206
15
The Lamplighter is valuing its inventory of desk lamps. On August 31, they had 47 desk lamps. What is the average cost per unit of the inventory?

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A)$4.50
B)$6.00
C)$6.50
D)$7.40
16
The Lamplighter is valuing its inventory of desk lamps. On August 31, they had 47 desk lamps. Using the FIFO method what is the value of the 47 units in ending inventory?

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A)$186.12
B)$251.50
C)$263.50
D)$284.00
17
The Lamplighter is valuing its inventory of desk lamps. On August 31, they had 47 desk lamps. Using the LIFO method what is the value of the 47 units in ending inventory?

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A)$186.12
B)$251.50
C)$263.50
D)$284.00
18
The Book Nook estimates the annual cost of maintaining its inventory to be 20% of the inventory. This year the Book Nook plans to maintain an inventory totaling $875,000 in value. What amount should be set as the estimated cost of carrying the inventory for the year?
A)$175,000
B)$437,500
C)$1,050,000
D)$1,750,000
19
Cup-0'Joe's estimates the cost of carrying its inventory of goods to be 18% of the value of the merchandise. About how much does it cost Cup-O'Joe's annually to carry a $327,000 inventory?
A)$268,140.00
B)$72,140.00
C)$58,860.00
D)$18,166.67
20
ALGEBRA Uptown Clothes estimates that it costs $15,700 annually to carry the company's inventory of clothing and shoes. The costs are: 12% for storage, 6% for interest, and 2% for taxes and insurance. What is the value of the inventory?
A)$314,000
B)$78,500
C)$53,210
D)$18,840
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