During 2020, Wildhorse Furniture Company purchases a carload of wicker chairs. The manufacturer sells the chairs to Wildhorse for a lump sum of $29,925 because it is discontinuing manufacturing operations and wishes to dispose of its entire stock. Three types of chairs are included in the carload. The three types and the estimated selling price for each are listed below.
Type No. of Chairs Estimated Selling Price Each
Lounge chairs 1,040 $90
Armchairs 780 80
Straight chairs 1,820 50
During 2020, Splish sells 520 lounge chairs, 260 armchairs, and 312 straight chairs.
a. What is the amount of gross profit realized during 2020?
b. What is the amount of inventory of unsold straight chairs on December 31, 2020? (Round cost per chair to 2 decimal places, e. g. 78.25 and final answer to 0 decimal places, e. g. 5,845.)
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