Sam's Discount Appliance Company just received a shipment of 30 washing machines.The invoice list price for each washing machine is $365.The manufacturer's catalogue indicates that Sam can take the following discounts: 30/15/10 with 30 percent being the normal mark up,15 percent for free delivery and hook up,and 10 percent for local advertising and point- of- sale displays.If Sam performs all services required by the vendor,his net cost rate factor will be

Question

Quizplus · Accepted Answer

To calculate the net cost rate factor, we need to find the total percentage of discounts that Sam can avail.

First, we need to calculate the discount for free delivery and hook up:
15% of $365 = $54.75

Next, we need to calculate the discount for local advertising and point-of-sale displays:
10% of ($365 - $54.75) = $31.32

Now, we need to calculate the total discount:
30% + 15% + 10% = 55%
55% of ($365 - $54.75 - $31.32) = $136.26

So, Sam's net cost rate factor will be:
($365 - $54.75 - $31.32 - $136.26)/$365 x 100% = 53.55%

Therefore, the best choice is B.

Sam's Discount Appliance Company Just Received a Shipment of 30