Grout,Inc.offers terms of 2/10,n/30 to credit customers.Tile Mart Corp.purchased 100 tile cutters with a list price of $20 each on March 5,2014,on account. If Tile Mart Corp.pays the amount of the invoice for its purchase on March 14,2014,how much cash will Grout receive from Tile Mart Corp.?

Question

Quizplus · Accepted Answer

Tile Mart Corp. is eligible for a 2% discount because they are paying within 10 days. The total list price is 100 cutters x $20 = $2,000. The discount is 2% of $2,000, which is $40. Therefore, the cash received is $2,000 - $40 = $1,960.

Grout,IncOffers Terms of 2/10,n/30 to Credit Customers