Slotnick Chemical received customer deposits on returnable containers in the amount of $300,000 during 2016.Fifteen percent of the containers were not returned.The deposits are based on the container cost marked up 20%.How much profit did Slotnick realize on the forfeited deposits?
A)$0.
B)$7,500.
C)$9,000.
D)$45,000.

Question

Quizplus · Accepted Answer

The profit on the forfeited deposits is 15% of the $300,000 deposits, or $45,000. However, the deposits are based on the container cost marked up 20%, so the profit is only 80% of $45,000, or $36,000.

Slotnick Chemical Received Customer Deposits on Returnable Containers in the Amount