Sarah just received an invoice for $12,000 with terms of 2/10,n/30.The invoice date was June 1.Her contract with the vendor indicates a charge of 1.5 percent per month on late payments.If Sarah pays this bill on June 5 she will send the vendor a check for
A)$12,000.
B)$12,180.
C)$11,760.
D)Cannot answer without more information.

Question

Quizplus · Accepted Answer

If Sarah pays within the discount period of 10 days, she will receive a 2% discount on the invoice amount, which is $12,000 x 2% = $240. Therefore, the amount she will pay if she takes advantage of the discount is $12,000 - $240 = $11,760. Even though the contract with the vendor indicates a late payment fee of 1.5% per month, it is irrelevant in this case since Sarah is paying within the discount period.

Sarah Just Received an Invoice for $12,000 with Terms of 2/10,n/30.The