Corona Distributors has received an invoice totaling $80,000 with payment terms of 2/15, net 60. This means the buyer can avail a 2% discount if the invoice is paid within 15 days; otherwise, the full amount is due in 60 days. How much does the buyer save if the bill is paid within the discount period a. $800 b. $1,600 c. $2,400 d. $3,200

Corona Distributors has received an invoice totaling $80,000 with payment terms of 2/15, net 60. This means the buyer can avail a 2% discount if the invoice is paid within 15 days; otherwise, the full amount is due in 60 days. How much does the buyer save if the bill is paid within the discount period a. $800 b. $1,600 c. $2,400 d. $3,200

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter17: Advanced Issues In Revenue Recognition

Section: Chapter Questions

Problem 11RE

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A. R. Black, Ltd. has received an invoice for $500 subject to trade discounts 10%, 20%. A cash discount with terms 4/15, n/30 is offered. If A.R. Black pays the bill within the discount period, find the amount paid.
The credit terms offered to a customer by a business firm are 2/10, n/30, which means that the customer must pay the bill within 10 days. the customer can deduct a 2% discount if the bill is paid within 10 days of the invoice date. the customer can deduct a 2% discount if the bill is paid between the 10th and 30th day from the invoice date. two sales returns can be made within 10 days of the invoice date and no returns thereafter.
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