Multiple Choice
How do quarterly premium payments typically affect the annual cost of insurance as reported in net sales calculations?
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4. Merchandising Operations
Net Sales
Multiple Choice
If a company reports net sales of 700,000 pennies for the year, what is the equivalent amount in dollars?
A
\$70,000
B
\$7,000
C
\$70
D
\$700
Verified step by step guidance1
Understand the problem: The company reports net sales in pennies, and the goal is to convert this amount into dollars. Recall that there are 100 pennies in one dollar.
Identify the conversion factor: Since 1 dollar equals 100 pennies, the conversion factor is 1/100 or dividing the total pennies by 100.
Set up the equation: To convert pennies to dollars, divide the total number of pennies (700,000) by 100. This can be expressed mathematically as:
Perform the division: Simplify the fraction by dividing 700,000 by 100. This will give the equivalent amount in dollars.
Interpret the result: Once the division is complete, the resulting value represents the net sales in dollars. Compare this value to the provided answer choices to determine the correct one.
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