Company A sells $500 of merchandise on account to Company B with credit terms of 2/10, n/30.If Company B pays within the discount period, how much cash will Company A receive?
A)$400
B)$410
C)$490
D)$500

Question

Quizplus · Accepted Answer

Company B is entitled to a 2% discount for paying within 10 days. The discount is 2% of $500, which is $10. Therefore, Company A will receive $490 ($500 - $10).

Company a Sells $500 of Merchandise on Account to Company