Question

At Delia’s company, the purchases are recorded at net amounts. On August 5, $40,000 worth of merchandise was purchased on account for terms of 2/10, n/30. $3,000 of this merchandise was returned, and the account was credited. As of August 31, the balance still had not been paid. What amount will be recorded as the purchase return?

Answer 1

$2,940

Explanation:

Data provided in the question:

Cost of merchandise purchased = $40,000

Cost of merchandise returned = $3,000

Terms = 2/10, n/30

Now,

The amount that will be recorded as the purchase return

= Cost of merchandise returned - Discount on cost of merchandise

= $3,000 - ( 2% of $3,000 )

= $3,000 - ( 0.02 × $3,000 )

= $3,000 - $60

= $2,940