Marigold\'s Market recorded the following events involving a recent purchase of

Question

Marigold's Market recorded the following events involving a recent purchase of merchandise: Received goods for $46000, terms 1/10, n/30. Returned $800 of the shipment for credit. Paid $300 freight on the shipment. Paid the invoice within the discount period. As a result of these events, the company's inventory increased by $45044. increased by $45500. increased by $44748. increased by $45048. The credit terms offered to a customer by a business firm are 2.9/10, n/30, which means that two sales returns can be made within 10 days of the invoice date and no returns thereafter. the customer must pay the bill within 10 days. the customer can deduct a 2.9% discount if the bill is paid between the 10th and 30th day from the invoice date. the customer can deduct a 2.9% discount if the bill is paid within 10 days of the invoice date. A credit sale of $4200 is made on July 15, terms 2/10, n/30, on which a return of $300 is granted on July 18. What amount is received as payment in full on July 24? $3822 $3930 $4116 $4200

Explanation / Answer

1) Calculate inventory :

So answer is d) Increase by $45048

2) The credit terms offered to customer by business firm are 2.9/10, n/30

So answer is d) the customer can deduct a 2.9% discount if the bill is paid within 10 days of the invoice date.

3) Amount received = 4200-300-(3900*2%) = 3822

So answer is a) $3822

Purchase 46000 Less; purchase return -800 Less: Purchase discount (46000-800)*1% -452 Add: Freight in 300 Cost of inventory 45048

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