A certain store purchased grills for $50 each and lawn chairs for $5 e

Question

A certain store purchased grills for $50 each and lawn chairs for $5 each and then sold each grill and each chair. The store's gross profit on each grill was 30 percent of its purchase price, and the store's gross profit on each chair was 50 percent of its purchase price. If the store sold 5 times as many chairs as grills and if the store's total gross profit on the grills and chairs was $550, what was the store's total revenue from the sale of the grills and chairs?

A. $1,530

B. $1,800

C. $2,050

D. $2,100

E. $2,360

Show Spoiler

Attachment:

Screenshot 2023-12-29 230227.png [ 127.18 KiB | Viewed 18490 times ]

Show Answer

Official Answer

C

Using official mocks already? Add GMAT Club Tests for harder practice, analytics, and explanations without overlapping Official Guide or official mock questions.
Try it now →

chetan2u · Accepted Answer

Let there be x grills sold, then 5x chairs are sold.

Profit on each grill: 30% of 50 or $15
Profit on each chair: 50% of 5 or $2.5

Total profit = 15*x + 2.5*5x = 27.5x = 550 
x = 20

Thus revenue generated = cost + profit 
50*20 + 5*100 + 550 = 1500 + 550 = $2050

C

If we were to give slightly lucrative wrong options, 1500 would surely be an option.

Sanyam_Maheshwari · Answer

Let's denote the number of grills purchased as = G 
and the number of lawn chairs purchased as = C

Given:

Purchase price for each grill = $50
Purchase price for each lawn chair = $5
The store's gross profit on each grill is 30% of its purchase price, so the profit per grill is 0.30 *50 = $15.
The store's gross profit on each chair is 50% of its purchase price, so the profit per chair is 0.50 * 5 = $2.50.

Now, the store sold 5 times as many chairs as grills, so 
C=5G.

The total gross profit on grills is 0.3*50 = $15
on chairs is 0.5*5 = $2.50

and the total gross profit on both is given as $550.

So, we can set up the equation:
15G+2.50C=550

Now, substitute 
C=5G into the equation:
15G+2.50(5G)=550

Solve for G 
G=20
C=5G=5×20=100

The total revenue from the sale of grills is 20 *(50 + 15) = 20 * 65 = $1300.
The total revenue from the sale of chairs is 100 * (5 + 2.50) = 100 * 7.50 = $750.

Therefore, the store's total revenue from the sale of grills and chairs is $1300 + $750 = $2050.

Vishalp05 · Answer

I took 3 minutes and 10 seconds to solve this one. Is it possible to do it in under 2 minutes with a shorter approach? Experts, please share your guidance.

ariyanak · Answer

KarishmaB   chetan2u   ScottTargetTestPrep  is there a faster way to do this?

nosaj · Answer

Also tried thinking about this, but the main takeaway for me here is that

Figure out quantity 
1) You're given total profit, 2) you know the total profit per item, 3) you know the ratio of items - therefore you can figure out the quantity of items

Figure out revenue 
1) Cost + Profit = Revenue (not how we commonly look at it... but good old GMAT sure makes simple concepts hard)
2) Use quantity and multiply against cost

sunet233 · Answer

Given:

Grills 
 Chairs 
 
  Cost = $50 
 Cost = $5 
 
  Profit = 30% of 50 = 15 
 Profit = 50% of 5 = 2.5 
 
  SP= 50+15 = 65 
 SP= 5+2.5 = 7.5

As store sold 5 times as many chairs as grills, x= 5x

Total Profit = P1 * No. of grills + P2 * No. of Chairs
 
550 = 15x + 2.5*(5x)
550 = 27.5x
x = 20

So, if x= 20 then 5x = 100
RG = 20*65 = 1300
RC = 100*7.5 = 750

Total = 1300+ 750 = 2050

MarkGMATMentor · Answer

On revenue and profit problems with two different products, a table is often a good idea to organize the information, particularly if you're feeling overwhelmed by the numbers.

Note that here, units purchased = units sold for both grills and chairs. That means that you can use profit = revenue - cost to calculate unit profit.

Here, using the given information, you have:
    
 P 
 = 
 R 
 - 
 C 
 
  grill 
 0.3(50)

50 
 
  chair 
 0.5(5)

5

Then you can calculate and fill in the rest:
    
 P 
 = 
 R 
 - 
 C 
 
  grill 
 15 
  
 65 
  
 50 
 
  chair 
 2.5 
  
 7.5 
  
 5

You also know total profit is $550, and that there are five times as many chairs as grills.

Let grills = g and chairs = 5g. Then set up an equation for total profit:

15g + 2.5(5g) = 550

27.5g = 550

g = 20

So there are 20 grills and 100 chairs.

Now calculate the total revenue:

65(20) + 7.5(100) --> 1300 + 750 --> $2050

The answer is C. Though not required, using a table here helps clarify the relationships between the various quantities. It also helps avoid using multiple variables to indicate grill profit, chair revenue, etc.  When you have a revenue / profit scenario like this with two different products (or services, companies, etc.), consider using a table to save yourself time and headaches.

AXECHILL · Answer

A Faster way to solve this is :

We are given total profit : $550
and we also know that the grill and chair were sold in 1:5

and from the question we understand that profit of 1 Grill + Profit of 5 Chair = $15 + 5 * $2.50 = $27.50

Now when we divide Total Profit / Profit per each group ( 1 grill + 5 chairs) you get

20 Groups

which means there were 20 Grills sold and 20*5 = 100 chairs sold.

From there we calculate total revenue by

Cost Price + Profit 
20(50)+100(5) + 550
=1000+500 + 550
= $2050

A certain store purchased grills for $50 each and lawn chairs for $5 e

Prep Toolkit

Top 5 GMAT Debrief Videos

615 to 715 in 15 Days (Ria's Strategies)

More than Quant/Verbal Abilities: Speed vs. Accuracy

745 with Only Self-Prep and GMAT Club

From 555 to 765: 210-point Improvement

Perfect 805 Score Debrief by Julia

My Rewards

Grills	Chairs
Cost = $50	Cost = $5
Profit = 30% of 50 = 15	Profit = 50% of 5 = 2.5
SP= 50+15 = 65	SP= 5+2.5 = 7.5

GMAT Problem Solving (PS) Questions

A certain store purchased grills for $50 each and lawn chairs for $5 e

Prep Toolkit

615 to 715 in 15 Days (Ria's Strategies)

More than Quant/Verbal Abilities: Speed vs. Accuracy

745 with Only Self-Prep and GMAT Club

From 555 to 765: 210-point Improvement

Perfect 805 Score Debrief by Julia

My Rewards