In 1995 a certain store had 1,800 tools in stock that had

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BTGmoderatorLU: Moderator; Posts: 2544; Joined: Sun Oct 15, 2017 1:50 pmFollowed by: 6 members

by BTGmoderatorLU » Mon Oct 29, 2018 12:20 pm

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Source: GMAT Prep

In 1995 a certain store had 1,800 tools in stock that had been purchased for $30 each. If 1,000 of these tools were sold in 1995 for $40 each and the remaining 800 were sold in 1996 for $50 each, how many greater was the gross profit on the tools sold in 1996 than the gross profit on those sold in 1995?

A. $0
B. $6,000
C. $8,000
D. $32,000
E. $40,000

The OA is B.

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Source: Beat The GMAT — Problem Solving | Mon Oct 29, 2018 12:20 pm

fskilnik@GMATH: GMAT Instructor; Posts: 1449; Joined: Sat Oct 09, 2010 2:16 pmFollowed by: 33 members; Thanked: 59 times

In 1995 a certain store had 1,800 tools in stock that had

by fskilnik@GMATH » Mon Oct 29, 2018 1:41 pm

BTGmoderatorLU wrote:Source: GMAT Prep

In 1995 a certain store had 1,800 tools in stock that had been purchased for $30 each. If 1,000 of these tools were sold in 1995 for $40 each and the remaining 800 were sold in 1996 for $50 each, how many greater was the gross profit on the tools sold in 1996 than the gross profit on those sold in 1995?

A. $0
B. $6,000
C. $8,000
D. $32,000
E. $40,000

\[\begin{array}{*{20}{c}}
{1800\,\,{\text{units}}} \\
{{\text{cost}}\,\,\$ 30\,{\text{each}}}
\end{array}\,\,\,\,\,\left\{ \begin{gathered}
\,\left( {95} \right)\,\,1000\,\,{\text{units}}\,,\,\,\,{\text{sold}}\,\,\$ 40\,\,{\text{each}}\,\,\,\,\, \to \,\,\,\,\,\,{\text{g}}{{\text{p}}_{\,95}}\,\, = \,\,\,\$ \,\,1000 \cdot \left( {40 - 30} \right) \hfill \\
\,\left( {96} \right)\,\,\,\,800\,\,{\text{units}},\,\,\,{\text{sold}}\,\,\$ 50\,\,{\text{each}}\,\,\,\,\, \to \,\,\,\,\,\,{\text{g}}{{\text{p}}_{\,96}}\,\, = \,\,\,\$ \,\,800 \cdot \left( {50 - 30} \right) \hfill \\
\end{gathered} \right.\]
\[? = {\text{g}}{{\text{p}}_{\,96}} - {\text{g}}{{\text{p}}_{\,95}} = 1000\left( {8 \cdot 2 - 10} \right) = 6000\,\,\,\,\left[ \$ \right]\]

This solution follows the notations and rationale taught in the GMATH method.

Regards,
Fabio.

Fabio Skilnik :: GMATH method creator ( Math for the GMAT)
English-speakers :: https://www.gmath.net
Portuguese-speakers :: https://www.gmath.com.br

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Brent@GMATPrepNow: GMAT Instructor; Posts: 16207; Joined: Mon Dec 08, 2008 6:26 pmFollowed by: 1268 members; Location: Vancouver, BC; Thanked: 5254 times; GMAT Score:770

by Brent@GMATPrepNow » Wed Oct 31, 2018 5:05 am

BTGmoderatorLU wrote:Source: GMAT Prep

In 1995 a certain store had 1,800 tools in stock that had been purchased for $30 each. If 1,000 of these tools were sold in 1995 for $40 each and the remaining 800 were sold in 1996 for $50 each, how many greater was the gross profit on the tools sold in 1996 than the gross profit on those sold in 1995?

A. $0
B. $6,000
C. $8,000
D. $32,000
E. $40,000

The OA is B.

1,000 of these tools were sold in 1995 for $40 each
So, the REVENUE = (1000)($40) = $40,000

The 1000 tools were purchased for $30 each.
So, the EXPENSE = (1000)($30) = $30,000

PROFIT for 1995 = $40,000 - $30,000 = $10,000
-----------------------------------------------
The remaining 800 were sold in 1996 for $50 each
So, the REVENUE = (800)($50) = $40,000

The 800 tools were purchased for $30 each.
So, the EXPENSE = (800)($30) = $24,000

PROFIT for 1996 = $40,000 - $24,000 = $16,000

How many greater was the gross profit on the tools sold in 1996 than the gross profit on those sold in 1995?
1996 profit - 1995 profit = $16,000 - $10,000 = $6,000

Answer: B

Cheers,
Brent

Brent Hanneson - Creator of GMATPrepNow.com

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