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Trade Discount and Cash Discounts

Trade Discount and Cash Discounts

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Trade Discount and Cash Discounts Merchandise was purchased on account from Jacob's Distributors on May 17. The purchase price was $2,000, less a 10% trade discount and credit terms of 2/10, n/30. 1. Calculate the net amount to record the invoice, less the 10% trade discount. 2. Calculate the amount to be paid on this invoice within thé discount period. $4 3. Journalize the purchase of the merchandise on May 17 in a general journal. Journalize the payment on May 27 (within the discount period). Page: DATE ACCOUNT TITLE DOC. POST. DEBIT CREDIT NO. REF. 20-- 1 May 17 1 2 Purchased merchandise 4 27 4 5 6. 6. Paid invoice within discount period 7 00000 00 000 3.
Transcribed Image Text:Trade Discount and Cash Discounts Merchandise was purchased on account from Jacob's Distributors on May 17. The purchase price was $2,000, less a 10% trade discount and credit terms of 2/10, n/30. 1. Calculate the net amount to record the invoice, less the 10% trade discount. 2. Calculate the amount to be paid on this invoice within thé discount period. $4 3. Journalize the purchase of the merchandise on May 17 in a general journal. Journalize the payment on May 27 (within the discount period). Page: DATE ACCOUNT TITLE DOC. POST. DEBIT CREDIT NO. REF. 20-- 1 May 17 1 2 Purchased merchandise 4 27 4 5 6. 6. Paid invoice within discount period 7 00000 00 000 3.
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