Abe Company sold merchandise on credit to Bee Company for $1,000 on July 1,with terms of 2/10,net /30.On July 6,Bee returned $200 worth of merchandise claiming the materials were defective.On July 8,Abe received a payment from Bee and credited Accounts Receivable for $350.On July 24,Bee Company paid the remaining balance on its account.
-See Abe Company information above.How much was the total Sales Discounts given to Bee during July?

Question

Quizplus · Accepted Answer

$7The original sale was for $1,000, and Bee returned $200 worth of merchandise, leaving a balance of $800. The terms 2/10, n/30 allow for a 2% discount if paid within 10 days. Bee paid $350 on July 8, within the discount period. The discount on the $350 payment is not directly given, but since the total remaining balance was paid without mention of further discounts, we can infer the discount was applied to this initial payment. The correct calculation for the discount on the $350 payment is not provided in the question, but the only plausible discount amount listed is $7, which would be correct if the payment was intended to fully utilize the discount on a portion of the balance (2% of $350 is $7). The remaining payment on July 24 would not qualify for the discount as it was outside the 10-day window.

Abe Company Sold Merchandise on Credit to Bee Company for $1,000