Essence of Skunk Fragrances, Ltd., sells 5,100 units of its perfume collection e

Question

Essence of Skunk Fragrances, Ltd., sells 5,100 units of its perfume collection each year at a price per unit of $381. All sales are on credit with terms of 2/20, net 60. The discount is taken by 45 percent of the customers. (Enter your answer as directed, but do not round intermediate calculations.)

What is the amount of the company

Essence of Skunk Fragrances, Ltd., sells 5,100 units of its perfume collection each year at a price per unit of $381. All sales are on credit with terms of 2/20, net 60. The discount is taken by 45 percent of the customers. (Enter your answer as directed, but do not round intermediate calculations.)

Explanation / Answer

Accounts Receivable recorded in books (5100 x $381) as discount is recorded only when payment is received on time $          1,943,100 Estimated Accounts Receivable Sales $          1,943,100 Customers availing discount (45%) $              874,395 Discount (2% of $874,395) $                17,488 Net Receivable ($1943100-$17488) $          1,925,612

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