Trade Discounts Extended Quantity Unit Merchandise Unit List Total 150 ea. Blenders $69.95 20/15/15 400 ea. Toasters $38.88 20/10/10 18 doz. Coffee Mills $244.30 30/9/7 12 doz. Juicers $480.00 25/10/5 Invoice subtotal Extra 5 % volume discount on total order 2. Invoice total %24 %24 %24
Trade Discounts Extended Quantity Unit Merchandise Unit List Total 150 ea. Blenders $69.95 20/15/15 400 ea. Toasters $38.88 20/10/10 18 doz. Coffee Mills $244.30 30/9/7 12 doz. Juicers $480.00 25/10/5 Invoice subtotal Extra 5 % volume discount on total order 2. Invoice total %24 %24 %24
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Suppose a certain appliance store purchases the following items. Calculate the extended total after the trade discounts for each line, the invoice subtotal, and the invoice total. (Round your answers to the nearest cent.)
Expert Solution
How to calculate
For the trade discount 20/15/15 of Blenders calculated net price factor as follows.
100% 100%
-20% -15% - 15%
80% x 85% x 85%
The net price factor:
0.80 x 0.85 x 0.85 = 0.578
The extended total is calculated as below.
Extended total = Number of items Unit price
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