A director of accounts received a bill for $1319, dated July 10, with sales terms 3 / 10 EOM. Find the cash discount and amount due if the bill was paid August 30.

Question

Quizplus · Accepted Answer

The sales terms 3/10 EOM mean that a 3% discount is available if the bill is paid within 10 days after the end of the month of the invoice date. Since the invoice is dated July 10, the discount period ends on August 10. The bill was paid on August 30, which is after the discount period, so no discount applies. The full amount of $1319 is due.

A Director of Accounts Received a Bill for $1319, Dated