Ask Question
9 October, 10:47

Sheridan Company sells merchandise on account for $6400 to Carla Vista Company with credit terms of 2/10, n/30. Block Company returns $1800 of merchandise that was damaged, along with a check to settle the account within the discount period. What is the amount of the check

+4
Answers (1)
  1. 9 October, 12:56
    0
    Answer: $4,508

    Explanation:

    Companies usually give discounts with credit terms to encourage Receivables to pay faster.

    In this scenario, credit terms of 2/10, n/30 were offered which means that if Carla Vista Company pays within 10 days they get a discount of 2% but if they don't they should pay the full amount in 30 days.

    They paid within the discount period meaning that they qualify for the discount of 2% but they however returned goods worth $1800.

    So calculating for that would be,

    = (6,400 - 1800) (1 - 0.02)

    = $4,508

    The amount of the check is $4,508
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Sheridan Company sells merchandise on account for $6400 to Carla Vista Company with credit terms of 2/10, n/30. Block Company returns $1800 ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers