Ryan, Inc. purchased a delivery truck with a $42,000 list price. The company was given a $4,200 cash discount by the dealer, and paid $2,100 sales tax. Annual insurance on the truck is $1,050. As a result of the purchase, by how much will Ryan, Inc. increase its truck account?
A) $42,000.
B) $37,800.
C) $40,950.
D) $39,900.

Question

Quizplus · Accepted Answer

The truck account will increase by the net purchase price plus sales tax: $42,000 - $4,200 + $2,100 = $39,900. Insurance is not included in the truck account.

Ryan, Inc Purchased a Delivery Truck with a $42,000 List Price