Question

I just wanna know how do you know the percentage please help,,,,,Marble Company purchased a machine costing $137,000, terms 3/10, n/30. The machine was shipped FOB shipping point and freight charges were $3,700. The machine requires special mounting and wiring connections costing $11,700. When installing the machine, $3,000 in damages occurred. Materials costing $3,200 are used in testing and adjusting the machine to produce a satisfactory product. Compute the cost recorded for this machine assuming Marble paid within the discount period. I just want to know how do you know the percentage no one explains!! Thank you

Answer 1

$150,253.00

Step-by-step explanation:

The cost to be recorded will include all the direct cost of installing the machine less the discount allowed.

The total cost of the machine will be

cost price $137,000

Freight charges $3,700

mounting & wires $11,000

testing materials $3,200

Total cost $154,900

The machine was paid with the discount period. The tern3/10, n 30 means that the buyer will get a 3% discount if they pay with ten days of the invoice date. Full payment is expected within 30 days if the buyer does not pay within ten days.

the discount amount will be 3% of $154,900

=3/100 x $154,900

=0.03 x $154,900

=$4,647.00

the amount recorded will be

=$154,900.00 - $4,647.00

= $150,253.00