Sales Discounts: It refer to the cash discount that a seller offers to the buyer for the prompt payment on the balance due from the buyer according to the credit terms. The sales discount is based on the net sale that is the invoice amount less the sales returns and allowances. It is considered as a contra revenue account because it decreases the sales revenue. To Explain: The terms 1/10, n/30 and discuss the implications of switching over the payment terms.

Question

Want to see the full answer?

Answer 1

Question

Chapter 5, Problem 13Q

To determine

Sales Discounts: It refer to the cash discount that a seller offers to the buyer for the prompt payment on the balance due from the buyer according to the credit terms. The sales discount is based on the net sale that is the invoice amount less the sales returns and allowances. It is considered as a contra revenue account because it decreases the sales revenue.

To Explain: The terms 1/10, n/30 and discuss the implications of switching over the payment terms.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

SUBJECT -GENERAL ACCOUNT

A company has net sales of $125,000, cost of goods sold of $50,000, operating expenses of $35,000, and selling expenses of $11,000. What is the gross profit? A. $75,000 B. $40,000 C. $29,000 D. $50,000

Can you please solve this financial account query

Answer 2

Question

Chapter 5, Problem 13Q

To determine

Sales Discounts: It refer to the cash discount that a seller offers to the buyer for the prompt payment on the balance due from the buyer according to the credit terms. The sales discount is based on the net sale that is the invoice amount less the sales returns and allowances. It is considered as a contra revenue account because it decreases the sales revenue.

To Explain: The terms 1/10, n/30 and discuss the implications of switching over the payment terms.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 5, Problem 13Q

To determine

Sales Discounts: It refer to the cash discount that a seller offers to the buyer for the prompt payment on the balance due from the buyer according to the credit terms. The sales discount is based on the net sale that is the invoice amount less the sales returns and allowances. It is considered as a contra revenue account because it decreases the sales revenue.

To Explain: The terms 1/10, n/30 and discuss the implications of switching over the payment terms.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 5, Problem 13Q

To determine

Sales Discounts: It refer to the cash discount that a seller offers to the buyer for the prompt payment on the balance due from the buyer according to the credit terms. The sales discount is based on the net sale that is the invoice amount less the sales returns and allowances. It is considered as a contra revenue account because it decreases the sales revenue.

To Explain: The terms 1/10, n/30 and discuss the implications of switching over the payment terms.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 5, Problem 13Q

To determine

Sales Discounts: It refer to the cash discount that a seller offers to the buyer for the prompt payment on the balance due from the buyer according to the credit terms. The sales discount is based on the net sale that is the invoice amount less the sales returns and allowances. It is considered as a contra revenue account because it decreases the sales revenue.

To Explain: The terms 1/10, n/30 and discuss the implications of switching over the payment terms.

Answer 6

Chapter 5, Problem 13Q

To determine

Sales Discounts: It refer to the cash discount that a seller offers to the buyer for the prompt payment on the balance due from the buyer according to the credit terms. The sales discount is based on the net sale that is the invoice amount less the sales returns and allowances. It is considered as a contra revenue account because it decreases the sales revenue.

To Explain: The terms 1/10, n/30 and discuss the implications of switching over the payment terms.

Answer 7

Chapter 5, Problem 13Q

To determine

Sales Discounts: It refer to the cash discount that a seller offers to the buyer for the prompt payment on the balance due from the buyer according to the credit terms. The sales discount is based on the net sale that is the invoice amount less the sales returns and allowances. It is considered as a contra revenue account because it decreases the sales revenue.

To Explain: The terms 1/10, n/30 and discuss the implications of switching over the payment terms.

Answer 8

Expert Solution & Answer

Answer 9

Expert Solution & Answer

Answer 10

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 11

Ch. 5 - Prob. 1Q Ch. 5 - Prob. 2Q Ch. 5 - Prob. 3Q Ch. 5 - Prob. 4Q Ch. 5 - Waymon Co. has net sales of 100,000, cost of goods...Ch. 5 - Masie Ascot believes revenues from credit sales...Ch. 5 - (a) What is the primary source document for...Ch. 5 - Prob. 8Q Ch. 5 - As the end of Smyle Companys fiscal year...Ch. 5 - To encourage bookstores to buy a broader range of...

Solution Summary: The author explains that a sales discount is based on the invoice amount less sales returns and allowances, which decreases sales revenue. Switching from earlier credit terms to 2/10, n/45 would result in low inventory turnover

Videos

Want to see the full answer?

Chapter 5 Solutions