A company that purchases inventory costing $10,000 onterms 2/10, n/30, but first returns one-half of those goods,will receive a discount of what amount if it pays on thelast day of the discount period?a. $0 c. $200b. $100 d. $5,000

A company that purchases inventory costing $10,000 onterms 2/10, n/30, but first returns one-half of those goods,will receive a discount of what amount if it pays on thelast day of the discount period?a. $0 c. $200b. $100 d. $5,000

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter6: Merchandising Transactions

Section: Chapter Questions

Problem 10Q: If a retailer purchased inventory in the amount of $750, terms 2/10, n/60, returned $30 of the...

See similar textbooks

Related questions

Q: For the next seven (6) items, use the information below: Debit Credit Account Title Sales Sales…

A: Note: Since you have posted a question with multiple sub-parts, we will solve first three subparts…

Q: On April 2, Kelvin sold $35000 of inventory items on credit with the terms 2/10, net 30. Payment on…

A: Option d is correct.

Q: A retailer pays on credit for $650 worth of inventory, terms 3/10, n/40. If the merchandiser pays…

A: Inventory sold on credit is worth $650. The terms of Inventory is 3/10 which means if the inventory…

Q: On 3/1, a company buys $5,000 of merchandise with terms 2/10, n/15. On 3/7, the company returns $500…

A: >Journal entries are used to record transaction.>Purchase transaction is recorded byDebiting…

Q: 21)April 4, 2020 Smith and West, who uses the periodic inventory system, purchased 1000 widgets from…

A: Credit purchase indicates the transaction made by the company on account and accepts the obligation…

Q: The company purchased merchandise for ₱55,496 less 2 on terms 50% down, balance 2/10, n/30. How…

A: Purchase discount is a discount provided by the seller if payment is made within a specific period…

Q: What is the net cost of the goods if Marigold Company pays within the discount period?

A: If payment is made within discount period, then Marigold would receive the discount offered by…

Q: Geran Company purchased merchandise inventory with an invoice price of $5,000 and credit terms of…

A: The credit terms of 2/10, n/30 means that the total available credit term is 30 days. The purchaser…

Q: 2. Compute for the Cost of Goods Sold using the following: • Sales – P15,000 • Purchases – P2,000 •…

A: Here in this question we are require to calculate cost of good sold. Cost of goods sold is a cost…

Q: 8. Elkins Corporation uses the perpetual inventory method. On March 1, it purchased $20,000 of…

A: Inventory Purchased on credit includes inventory accounts debit and accounts payable account credit.…

Q: 21) April 4, 2020 Smith and West, who uses the periodic inventory system, purchased 1000 widgets…

A: Given information, Mr smith and west has purchased widgets on account from ABC company. HST…

Q: Alliance Corporation purchased inventory with an invoice price of $22,000 and credit terms of 1/10,…

A: Formula: Discount amount = Invoice amount x Discount rate.

Q: ABC Company sells inventory to XYZ Company for $2,400. If XYZ purchases additional inventory it…

A: Discount on purchase :— It is an offer provided to purchaser to Purchase Goods in Less Price then…

Q: Close A company using the perpetual inventory system purchased inventory worth $25,000 on account…

A: In the given question it is given that inventory worth $25000 were purchased and after 2 days…

Q: On August 5, Oriole Ltd. sells goods for $1530 and the cost to Oriole was $700. Oriole expects a…

A: Journal Entry: Journal entry is the act of keeping records of transactions in an accounting journal.…

Q: Orange Co. sold Red Co. merchandise on account FOB shipping point, 2/10, net 30, for 10,000. Orange…

A: Cost of purchase of Inventory 10,000 Add: Shipping Charges 200 Total…

Q: April 4, 2020 Smith and West, who uses the Perpetual inventory system, purchased 1000 widgets from…

A: Journal entries refer to the recording of transactions in an appropriate way. With the help of…

Q: ABC Company makes the following purchases: 1.One item on 2/2/2020 for $10 2.One item on 2/15/2020…

A: LIFO means last in first out where as FIFO means first in first out. Inventory and cost of goods…

Q: Assume Anderson’s General Store bought, on credit, a truckload of merchandise from…

A: Purchase discount = (Purchases - Purchase return) x discount rate = ($23,000 - $1,200) x 2% = $436

Q: Shell Company purchased merchandise inventory with an invoice price of $4,000 and credit terms of…

A: Given Information : Invoice price of merchandise inventory purchased = $4,000 Credit terms = 2/10,…

Q: JELLY'S BEAN uses the perpetual inventory method. On May 1, it purchased ₱20,000 of inventory, terms…

A: Credit term 2/10, n/30 means if payment is done within 10 days from the date of invoice a discount…

Q: 2. Jackson Company Income Statement: Inventory, January 1, 2020 Purchases Purchase returns and…

A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…

Q: A retailer pays on credit for $650 worth of inventory, terms 3/10, n/40. If the merchandiser pays…

A: Perpetual inventory system: The perpetual inventory system records and updates the inventory after…

Q: Q: Find out the following missing values Purchase price of the inventory Rs=1,200,000, + Freight-in…

A: “Since you have posted a question with many sub-parts, we will solve three sub-parts for you. To get…

Q: April 4, 2020 Smith and West, who uses the periodic inventory system, purchased 1000 widgets from…

A: Due to purchases on credit, accounts payable are increases with the purchase amount and other…

Q: Assuming that there was no beginning inventory balance, the cost of inventory would be: (Assume a…

A: Given that: A company purchased inventory for $2,000 from a vendor on account, FOB shipping point,…

Q: On April 12, HK Company purchases inventory of 60.000 TL + 10% VAT on account with terms of 2/10…

A: Journal Entry:- These are prepared by the companies with debit and credit sides in order to match…

Q: Hussain Company purchased inventory on account from a supplier for Rs. 65,000, terms 1/10, n/30.…

A: Periodic and perpetual inventory systems are two main systems of inventory valuation. Under periodic…

Q: Vaughn Manufacturing uses the perpetual inventory and the gross method. On March 1, it purchased…

A: Net purchases = Total purchases - purchase return =74000-9000 = 65000

Q: A Retailer purchased merchandise inventory with an invoice price of RO 80,000 and credit terms are…

A: The net cost of goods sold if payment made within discount period is 78,400 Net Cost of Goods…

Q: A $1,000 sale is made on May 1 with terms 2/10, n/30.Items with a $100 selling price are returned on…

A: The terms 2/10, n/30 means two percent discount will be given if payment is received within 10 days…

Q: If merchandise is sold on account to a customer for $1,000, terms FOB shipping point, 1/10, n/30,…

A: Lets understand the basics. Seller for attracting early payment, gives the discount term to the…

Q: A wholesaler sold merchandise inventory with in invoice price RO 16,000 to the customer of business…

A: Credit terms 3/10, n/60 means customer will get a discount of 3% if payment is made within 10 days,…

Q: A customer pays on credit for $1,250 worth of merchandise, terms 4/15, n/30. If the customer pays…

A: Perpetual Inventory System: Perpetual Inventory System refers to the inventory system that maintains…

Q: How much is the Input VAT? (Excluding Transitional Input VAT) RTT opt to register to VAT on its 3rd…

A: Input tax means the VAT due on or paid by a VAT-registered on importation of goods or local purchase…

Q: owned by Abner Bravo) for the three-month period ended March 31, 2020 Sales 500,000 Merchandise…

A: The direct costs of producing the commodities sold by a corporation are referred to as the cost of…

Q: Inventory, beg. ₱50,000; Net purchases, ₱120,000; Cost of goods sold, ₱80,000. How much is the…

A: Inventory, End = Inventory, Beg + Net purchases - Cost of goods sold

Q: Tony's Market recorded the following events involving a recent purchase of merchandise: Received…

A: The inventory cost would include all cost incurred in bringing the inventory to its present location…

Q: A wholesaler sold merchandise inventory with in invoice price RO 16,000 to the customer of business…

A: COGS stands for Cost of goods sold which is defined as the direct cost of producing the goods sold…

Question

A company that purchases inventory costing $10,000 on
terms 2/10, n/30, but first returns one-half of those goods,
will receive a discount of what amount if it pays on the
last day of the discount period?
a. $0 c. $200
b. $100 d. $5,000

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Working:

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

A retailer pays on credit for $650 worth of inventory, terms 3/10, n/40. If the merchandiser pays within the discount window, how much will the retailer remit in cash to the manufacturer? A. $19.50 B. $630.50 C. $650 D. $195
Dollar-Value LIFO A company adopted the LIFO method when its inventory was 1,800. One year later its ending inventory was 2,100, and costs had increased 5% during the year. Required: What is the ending inventory using dollar-value LIFO? Round to the nearest dollar.
A seller sells $800 worth of goods on credit to a customer, with a cost to the seller of $300. Shipping charges are $100. The terms of the sale are 2/10, n/30, FOB Destination. What, if any, journal entry or entries will the seller record for these transactions?
Discounts Nelson Company bought inventory for 50,000 on terms of 2/15, n/60. It pays for the first 37,500 of inventory purchased within the discount period and pays for the remaining 12,500 two months later. Required: 1. Prepare the journal entries to record the purchase and the payment under both the (a) gross price and (b) net price methods. Assume that Nelson uses the periodic inventory system. 2. Next Level Which of the two methods yields a conceptually preferable valuation of inventory?
Comprehensive The following information for 2019 is available for Marino Company: 1. The beginning inventory is 100,000. 2. Purchases returns of 4,000 were made. 3. Purchases of 300,000 were made on terms of 2/10, n/30. Eighty percent of the discounts were taken. 4. At December 31, purchases of 20,000 were in transit, FOB destination, on terms of 2/10, n/30. 5. The company made sales of 640,000. The gross selling price per unit is twice the net cost of each unit sold. 6. Sales allowances of 6,000 were made. 7. The company uses the LIFO periodic method and the gross method for purchase discounts. Required: 1. Compute the cost of the ending inventory before the physical inventory is taken. 2. Compute the amount of the cost of goods sold that came from the purchases of the period and the amount that came from the beginning inventory.
If a retailer purchased inventory in the amount of $680, terms 3/10, n/60, returned $120 of the inventory for a full refund, and received an allowance for $70, how much would the discount be if the retailer remitted payment within the discount window?
If a retailer purchased inventory in the amount of $750, terms 2/10, n/60, returned $30 of the inventory for a full refund, and received an allowance for $95, how much would the discount be if the retailer remitted payment within the discount window?
Kulsrud Company would like to estimate the current inventory level. Using the gross profit method and the following information, estimate the current inventory level for Kulsrud Company. Goods available for sale 100,000 Net sales 150,000 Normal gross profit as a percent of sales 40%
A retailer returns $400 worth of inventory to a manufacturer and receives a full refund. What accounts recognize this return before the retailer remits payment to the manufacturer? A. accounts payable, merchandise inventory B. accounts payable, cash C. cash, merchandise inventory D. merchandise inventory, cost of goods sold
Longmire Sons nude sales un credit to Alderman Sports totaling 500,000 on April 18. The cost of the goods sold is 400,000. Longmire estimates 3% of its sales to Alderman may be returned. On May 22, 9,000 worth of goods (with a cost of 7,200) are returned by Alderman. Longmire uses a periodic inventory system. Prepare the related journal entries for Longmire Sons.
A customer pays on credit for $1,250 worth of merchandise, terms 4/15, n/30. If the customer pays within the discount window, how much will they remit in cash to the retailer? A. $1,250 B. $1,200 C. $50 D. $500