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Crane Company sells $1900 of merchandise on account to Wildhorse Company with credit terms of 2/15, n/30. If Wildhorse Company remits a check taking advantage of the discount offered, what is the amount of Wildhorse's Company check

User Oliwia
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Final answer:

If Wildhorse Company takes advantage of the 2% sales discount offered by Crane Company within 15 days, the check amount they remit would be $1862, after applying the discount to the original invoice amount of $1900.

Step-by-step explanation:

The subject of the question is related to sales discounts and how they are calculated in business transactions, specifically within the scope of accounting. Crane Company offers merchandise on account to Wildhorse Company with credit terms of 2/15, n/30. This means that Wildhorse Company can take a 2% discount on the invoice amount if they pay within 15 days; otherwise, the net amount is due within 30 days.

To calculate the discount amount:

  • Discount rate: 2%
  • Invoice amount: $1900
  • Discount amount: $1900 × 0.02 = $38

Therefore, if Wildhorse Company takes advantage of the sales discount, they will pay:

  • Discounted amount: $1900 - $38 = $1862

Thus, the check amount from Wildhorse Company would be $1862.

User Leblanc Meneses
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