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Case: You are a store owner you are selling a bag of diorite for $78/40 lb. bag (retail). The customer wants to purchase 10 bags. To pay, the customer gives you a personal check for $1000.
Sadly, your cash box does not have the $220 change. You go to the electrical store next door. There you exchange your customer's check for $1000 in cash. You return to the customer and give them the bags (n=10) and the cash change (i.e., $220 in cash).
Later, the check is returned by the bank due to insufficient funds in the buyer's account, and you must then pay back the electrical store the $1000 cash you received from them. You had originally paid $39/bag of diorite wholesale.
You plan to file the loss for this transaction with your insurance company.
Question: What is your total loss on this transaction that you will be submitting for reimbursement?
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