document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=700032>Question 700032</A>: <I><SPAN STYLE=\"word-break: break-all;\"> On July 8, 2009, Leon's Kitchen Hut bought a set of pots with a $120.00 list price from Lambert Manufacturing. Leon's receives a 25% trade discount. Terms of the sale were 2/10, n/30. On July 14, Leon's sent a check to Lambert for the pots. Leon's expenses are 20% of the selling price. Leon's must also make a profit of 15% of the selling price. A competitor marked down the same set of pots 30%. Assume Leon's reduces its selling price by 30%.<BR>\n" );
document.write( "What is the sale price at Kitchen Hut?<BR>\n" );
document.write( "What was the operating profit or loss?\r<BR>\n" );
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document.write( "I know the answer just do not know how they got them? </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #431809 by </B><A HREF=/tutors/aboutme.mpl?userid=KMST><B>KMST(5328)</B></A><img src=\"/images/stars/stars-13.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=KMST><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/cgi-bin/show-face.mpl?user=KMST><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=431809\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> If Lambert Manufacturing lists the set at $120.00, but will give Leon's a 25% discount,<BR>\n" );
document.write( "the price for Leon's will be 75% (= 100%-25%) of $120.00,<BR>\n" );
document.write( "which calculates as $93.75 <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=0.75%2A120.00=93.75 ALIGN=MIDDLE  ALT=\"0.75%2A120.00=93.75\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
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document.write( "Since Leon's paid within 10 days to get the 2% discount,<BR>\n" );
document.write( "Leon's had to pay 98% (= 100%-2%) of $93.75,<BR>\n" );
document.write( "which calculates as $<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=93.75%2A0.98=91.875 ALIGN=MIDDLE  ALT=\"93.75%2A0.98=91.875\"   DISABLED_style= \"max-width:90%; height:auto;\" > .<BR>\n" );
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document.write( "If <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=x ALIGN=MIDDLE  ALT=\"x\"   DISABLED_style= \"max-width:90%; height:auto;\" > = Leon's selling price, which must cover the $91.88 paid to Lambert,<BR>\n" );
document.write( "plus <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=0.20x ALIGN=MIDDLE  ALT=\"0.20x\"   DISABLED_style= \"max-width:90%; height:auto;\" > for expenses (20% of selling price),plus <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=0.15x ALIGN=MIDDLE  ALT=\"0.15x\"   DISABLED_style= \"max-width:90%; height:auto;\" > in profits (15% of selling price),<BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=x=0.20x%2B0.15x%2B91.88 ALIGN=MIDDLE  ALT=\"x=0.20x%2B0.15x%2B91.88\"   DISABLED_style= \"max-width:90%; height:auto;\" > --> <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=x=0.65x%2B91.88 ALIGN=MIDDLE  ALT=\"x=0.65x%2B91.88\"   DISABLED_style= \"max-width:90%; height:auto;\" > --> <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=x-0.35x=91.88 ALIGN=MIDDLE  ALT=\"x-0.35x=91.88\"   DISABLED_style= \"max-width:90%; height:auto;\" > --> <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=0.65x=91.88 ALIGN=MIDDLE  ALT=\"0.65x=91.88\"   DISABLED_style= \"max-width:90%; height:auto;\" > --> <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=x=91.88%2F0.65 ALIGN=MIDDLE  ALT=\"x=91.88%2F0.65\"   DISABLED_style= \"max-width:90%; height:auto;\" > --> <IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=x=141.35 ALIGN=MIDDLE  ALT=\"x=141.35\"   DISABLED_style= \"max-width:90%; height:auto;\" > (rounded)<BR>\n" );
document.write( "Maybe that ($141.35) is what is called \"the sale price at Kitchen Hut.\"<BR>\n" );
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document.write( "If a competitor sells the same set for 30% less,<BR>\n" );
document.write( "they would be selling it for 70% (= 100%-30%) of $141.35.<BR>\n" );
document.write( "That would be $<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=141.35%2A0.70=98.945 ALIGN=MIDDLE  ALT=\"141.35%2A0.70=98.945\"   DISABLED_style= \"max-width:90%; height:auto;\" >, which rounds to $98.95.<BR>\n" );
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document.write( "If Leon's matches that price, it will barely cover the $91.88 paid to Lambert.<BR>\n" );
document.write( "The difference, $98.95-$91.88=$7.07 would not cover Leon's expenses,<BR>\n" );
document.write( "even if we calculate them as 20% of the reduced $98.95 sale price,<BR>\n" );
document.write( "20% of $98.95 is $<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=98.95%2A0.20 ALIGN=MIDDLE  ALT=\"98.95%2A0.20\"   DISABLED_style= \"max-width:90%; height:auto;\" > = $<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=19.79 ALIGN=MIDDLE  ALT=\"19.79\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
document.write( "Is the $7.07 considered \"operating profit, without taking expenses into account?<BR>\n" );
document.write( "Do we subtract expenses calculated as 20% of the reduced price, and it is considered a loss? In that case, the $19.79 expenses minus the $7.07 would be a loss of<BR>\n" );
document.write( "$19.79-$7.07=12.92.<BR>\n" );
document.write( "Or would you calculate Leon's expenses based on the originally calculated sale price of $141.35, as<BR>\n" );
document.write( "$<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=141.35%2A0.20 ALIGN=MIDDLE  ALT=\"141.35%2A0.20\"   DISABLED_style= \"max-width:90%; height:auto;\" >=$<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=28.27 ALIGN=MIDDLE  ALT=\"28.27\"   DISABLED_style= \"max-width:90%; height:auto;\" > ?<BR>\n" );
document.write( "In that case, would the loss be calculated as $27.72-$7.07=$21.20 ?\r<BR>\n" );
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