Dickson Inc. uses the perpetual inventory system. The company sold 500 units to Ajax Ltd. for a total sales price of $5,000. At the time of the sale, Dickson carried the inventory on its books at a cost of $3,000. If Ajax returns 50 units for a full refund, the net effect of recording the return will cause Dickson's:

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Alf

Business

14 May, 14:13

Dickson Inc. uses the perpetual inventory system. The company sold 500 units to Ajax Ltd. for a total sales price of $5,000. At the time of the sale, Dickson carried the inventory on its books at a cost of $3,000. If Ajax returns 50 units for a full refund, the net effect of recording the return will cause Dickson's:

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Baylee Allison · Answer 1

Answer:$2000

Explanation:

The cost per unit of stock is $6 i. e $3000/500 units, the selling price per unit is $10 i. e $5000/500.

The profit per unit is 4 ($10-$4) multiply by 500 units gives $2000 the net effect of recording the return.