If merchandise costing $2,500, terms FOB destination, 2/10, n/30, with prepaid transportation costs of $100, is paid within 10 days, the amount of the purchases discount is $48.

Question

Quizplus · Accepted Answer

The purchase discount is calculated as 2% of $2,500 (the cost of the merchandise), which equals $50, not $48. The transportation costs do not affect the calculation of the purchase discount.

If Merchandise Costing $2,500, Terms FOB Destination, 2/10, N/30, with Prepaid