Ball Company sells merchandise on account for $1,500 to Edds Company with credit terms of 2/10, n/30. Edds Company returns $300 of merchandise that was damaged, along with a check to settle the account within the discount period. What is the amount of the check?

Question

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The original sale was $1,500, and $300 worth of merchandise was returned, reducing the amount to $1,200. With a 2% discount for early payment, the discount is $24 (2% of $1,200), so the check amount is $1,176 ($1,200 - $24).

Ball Company Sells Merchandise on Account for $1,500 to Edds