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21 November, 06:13

Ayayai Corp. sells merchandise on account for $7000 to Nash's Trading Post, LLC with credit terms of 2/8, n/30. Nash's Trading Post, LLC returns $1600 of merchandise that was damaged, along with a check to settle the account within the discount period. What is the amount of the check?

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  1. 21 November, 09:21
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    The amount of the check is $5,292

    Explanation:

    The computation of the amount of the check is shown below:

    = (Sales amount - return amount - Discount rate of adjusted sales)

    = ($7,000 - $1,600 - 0.02 * $5,400

    = $5,400 - $108

    = $5,292

    The adjusted sales equals to

    = Sales amount - return amount

    = $7,000 - $1,600

    = $5,400

    We assume that the Nash's trading company paid the amount within 8 days so that it can avails 2% discount
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