A sales invoice included the following information: merchandise price, $4,500; transportation, $300; terms 1/10, n/eom, FOB shipping point.Assuming that a credit for merchandise returned of $600 is granted prior to payment, that the transportation is prepaid by the seller, and that the invoice is paid within the discount period, what is the amount of cash received by the seller?

Question

Quizplus · Accepted Answer

1. Net merchandise price = $4,500 - $600 = $3,900
2. Transportation is prepaid by the seller, so it does not affect the cash received.
3. Discount = 1% of $3,900 = $39
4. Cash received = Net merchandise price - Discount = $3,900 - $39 = $3,861

Therefore, the answer is choice C.

A Sales Invoice Included the Following Information: Merchandise Price, $4,500;