At the beginning of last month, a stationery store had in stock 250 writing pads...

[BTGmoderatorLU]

Source: GMAT Prep

At the beginning of last month, a stationery store had in stock 250 writing pads, which had cost the store $0.75 each. During the same month, the store made only one purchase of writing pads. What was the total amount spent by the store on the writing pads it had in stock at the end of the month?

1) Last month the store purchased 150 writing pads for $0.80 each.
2) last month the total revenue from the sale of writing pads was $180.

The OA is E

[Jay@ManhattanReview]

Source: GMAT Prep

At the beginning of last month, a stationery store had in stock 250 writing pads, which had cost the store $0.75 each. During the same month, the store made only one purchase of writing pads. What was the total amount spent by the store on the writing pads it had in stock at the end of the month?

1) Last month the store purchased 150 writing pads for $0.80 each.
2) last month the total revenue from the sale of writing pads was $180.

The OA is E

Note that the question is to find out the stock value of the remaining lot of the writing pads, out of the one purchase that was made in the last month.

At the end of the last month, there might some stock from the previous month as well as some stock from the purchase in the last month.

Each statement by itself is sufficient. With Statement 1, we know the value of the new purchase but not sale value. With Statement 2, we do not know the value of the new purchase made in the last month.

Even after taking both statements together, we can't find out the answer as we do not know what parts of the two stocks (1. lying at the beginning of the month, valued at $0.75 per pad; and 2. purchased during the month, valued at $0.80 per pad) were sold.

Insufficient.

The correct answer: E

Hope this helps!

-Jay
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[Scott@TargetTestPrep]

Source: GMAT Prep

At the beginning of last month, a stationery store had in stock 250 writing pads, which had cost the store $0.75 each. During the same month, the store made only one purchase of writing pads. What was the total amount spent by the store on the writing pads it had in stock at the end of the month?

1) Last month the store purchased 150 writing pads for $0.80 each.
2) last month the total revenue from the sale of writing pads was $180.

The OA is E

Solution:

To know the total amount spent by the store on the writing pads it had in stock at the end of the last month, we need to know all 3 of the following criteria:

1) The number of writing pads bought in the only purchase in the last month and the cost per writing pad (assuming the cost of the writing pads is not fixed),

2) The number of writing pads sold from the original inventory, and

3) The number of writing pads sold from the only purchase.

Statement One Only:

Last month the store purchased 150 writing pads for $0.80 each.

This gives us the information of one of the three criteria (the first one), but it doesn’t give us the other two criteria. Statement one alone is not sufficient.

Statement Two Only:

Last month the total revenue from the sale of writing pads was $180.

Since the $180 revenue could be made all from the writing pads from the original inventory, OR all from the writing pads from the only purchase, OR a combination of the two. We neither know the number of writing pads sold from the original inventory nor from the only purchase. This does not give us any of the three criteria we need. Statement two alone is not sufficient.

Statements One and Two Together:

With the two statements together, we still don’t know the last two criteria; thus, the two statements together are still not sufficient to answer the question.

Answer: E