Given credit terms of 3/10, n/30 on a sale of $2,000, calculate the sales discount, assuming payment was made within the 10-day time period. $60 $90 $900 $600
Given credit terms of 3/10, n/30 on a sale of $2,000, calculate the sales discount, assuming payment was made within the 10-day time period. $60 $90 $900 $600
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
![**Credit Terms and Sales Discount Calculation**
Given credit terms of 3/10, n/30 on a sale of $2,000, calculate the sales discount, assuming payment was made within the 10-day time period.
**Options:**
- **A) $60**
- **B) $90**
- **C) $900**
- **D) $600**
**Explanation:**
The credit terms "3/10, n/30" mean the buyer can take a 3% discount on the invoice amount if the payment is made within 10 days; otherwise, the net (full) amount is due within 30 days.
To calculate the sales discount:
1. Calculate 3% of $2,000:
\[
\text{Discount} = \$2000 \times \frac{3}{100} = \$60
\]
Therefore, the correct option is A) $60.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fa897fc34-ec0a-4e46-a54c-99548c0f8a55%2F20c2e5ed-c7e3-4a6b-a452-6d1aaee059cb%2Frfbuex7_processed.jpeg&w=3840&q=75)
Transcribed Image Text:**Credit Terms and Sales Discount Calculation**
Given credit terms of 3/10, n/30 on a sale of $2,000, calculate the sales discount, assuming payment was made within the 10-day time period.
**Options:**
- **A) $60**
- **B) $90**
- **C) $900**
- **D) $600**
**Explanation:**
The credit terms "3/10, n/30" mean the buyer can take a 3% discount on the invoice amount if the payment is made within 10 days; otherwise, the net (full) amount is due within 30 days.
To calculate the sales discount:
1. Calculate 3% of $2,000:
\[
\text{Discount} = \$2000 \times \frac{3}{100} = \$60
\]
Therefore, the correct option is A) $60.
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Recommended textbooks for you
![Essentials Of Investments](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781260013924/9781260013924_smallCoverImage.jpg)
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
![FUNDAMENTALS OF CORPORATE FINANCE](https://www.bartleby.com/isbn_cover_images/9781260013962/9781260013962_smallCoverImage.gif)
![Financial Management: Theory & Practice](https://www.bartleby.com/isbn_cover_images/9781337909730/9781337909730_smallCoverImage.gif)
![Essentials Of Investments](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781260013924/9781260013924_smallCoverImage.jpg)
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
![FUNDAMENTALS OF CORPORATE FINANCE](https://www.bartleby.com/isbn_cover_images/9781260013962/9781260013962_smallCoverImage.gif)
![Financial Management: Theory & Practice](https://www.bartleby.com/isbn_cover_images/9781337909730/9781337909730_smallCoverImage.gif)
![Foundations Of Finance](https://www.bartleby.com/isbn_cover_images/9780134897264/9780134897264_smallCoverImage.gif)
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
![Fundamentals of Financial Management (MindTap Cou…](https://www.bartleby.com/isbn_cover_images/9781337395250/9781337395250_smallCoverImage.gif)
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
![Corporate Finance (The Mcgraw-hill/Irwin Series i…](https://www.bartleby.com/isbn_cover_images/9780077861759/9780077861759_smallCoverImage.gif)
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education