Tysen Retailers purchased merchandise with a list price of $50,000, subject to trade discounts of 20% and 10%, with no cash discounts allowable.Tysen should record the cost of this merchandise as
A)$35,000.
B)$36,000.
C)$39,000.
D)$50,000.

Question

Quizplus · Accepted Answer

The trade discounts are applied sequentially. First, a 20% discount on $50,000 reduces the price to $40,000. Then, a 10% discount on $40,000 reduces the price to $36,000.

Tysen Retailers Purchased Merchandise with a List Price of $50,000