A retailer purchases merchandise with a catalog list price of $15,000. The retailer receives a 30% trade discount and credit terms of 2/10, n/30. What amount should the retailer debit to the Merchandise Inventory account?

Question

Quizplus · Accepted Answer

The retailer receives a 30% trade discount on the list price, so the purchase price is $15,000 - ($15,000 * 0.30) = $10,500. The credit terms do not affect the amount debited to Merchandise Inventory.

A Retailer Purchases Merchandise with a Catalog List Price of $15,000