Additional Problem 1 (Part Level Submission)

Oriole Manufacturing Inc. shipped merchandise with a total value of $62,000 to FFA Retailing Ltd. on May 1. The agreement between the two companies was that FFA was to sell the product on consignment for Oriole Manufacturing. Oriole incurred $4,700 in shipping costs in order to ship the merchandise. FFA paid a local newspaper $1,700 for advertising costs (which Oriole promised to reimburse). At September 30, the end of the accounting year for both companies, FFA had sold 70% of the merchandise for total sales of $68,000. FFA notified Oriole of the sales, retained a 20% commission, and remitted the cash due to Oriole.