Minkoff Corporation purchased merchandise inventory with an invoice price of $16,000 and credit terms of 2/10, n/30. How much cash will Minkoff pay if they pay within the discount period?

Question

Quizplus · Accepted Answer

If Minkoff pays within the discount period, they can take advantage of the 2% discount offered by the seller. The discount will be calculated as: 
$16,000 x 0.02 = $320 
Therefore, Minkoff will only need to pay: 
$16,000 - $320 = $15,680

Minkoff Corporation Purchased Merchandise Inventory with an Invoice Price of $16,000