Small Corporation sells merchandise on account for $3,000 to Big Corporation with credit terms of 2/10, n/30. Big returns $600 of merchandise that was damaged, along with a cheque to settle the account within the discount period. What is the amount of the cheque?

Question

Quizplus · Accepted Answer

The original sale was $3,000, but $600 of merchandise was returned, reducing the amount to $2,400. The discount for paying within 10 days is 2%, so the discount is $2,400 * 0.02 = $48. Therefore, the amount of the cheque is $2,400 - $48 = $2,352.

Small Corporation Sells Merchandise on Account for $3,000 to Big