Tony's Market recorded the following events involving a recent purchase of merchandise: Received goods for $80,000, terms 2/10, n/30.
Returned $1,600 of the shipment for credit.
Paid $400 freight on the shipment.
Paid the invoice within the discount period.
As a result of these events, the company's inventory

Question

Quizplus · Accepted Answer

The company paid the invoice within the discount period, so it took the 2% discount. The net amount of the invoice is $80,000 - (2% x $80,000) = $78,400. The company also paid $400 for freight, so the total cost of the inventory is $78,400 + $400 = $78,800. The company returned $1,600 of the shipment for credit, so the final cost of the inventory is $78,800 - $1,600 = $77,200.

Tony's Market Recorded the Following Events Involving a Recent Purchase