Question

A company purchased $2,100 of merchandise on July 5 with terms 2/10, n/30. On July 7, it returned $230 worth of merchandise. On July 8, it paid the full amount due. The amount of the cash paid on July 8 equals:

Answer 1

$1,832.6

Step-by-step explanation:

Data provided in the question:

Cost of merchandise purchased = $2,100

Terms = 2/10, n/30

Cost of the merchandise returned = $230

Now,

The Amount of merchandise actually purchased

= Cost of merchandise purchased - Cost of the merchandise returned

= $2,100 - $230

= $1,870

also,

Amount of discount = 2% of Amount of merchandise actually purchased

= 0.02 × $1,870

= $37.4

Therefore,

The amount of the cash paid on July 8

= Amount of merchandise actually purchased - Amount of discount

= $1,870 - $37.4

= $1,832.6