If merchandise bought on account has a list price of $5,000, with a trade discount of 25% and credit terms of 1/10, n/30, what is the amount to be credited to Accounts Payable?

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Quizplus · Accepted Answer

The amount to be credited to Accounts Payable is the price after the trade discount but before any cash discounts for early payment. The trade discount is 25% of $5,000, which is $1,250. Therefore, the price after the trade discount is $5,000 - $1,250 = $3,750.

If Merchandise Bought on Account Has a List Price of $5,000