Question

On June 15, Kersee Company sold merchandise on account to Eng Co. for $1,000, terms 2/10, n/30. On June 20, Eng Co. returns merchandise worth $300 to Kersee Company. On June 24, payment is received from Eng Co. for the balance due. What is the amount of cash received on June 24?

a) $700.
b) $680.
c) $686.
d) None of the answer choices are correct.

Answer 1

%686

Step-by-step explanation:

To calculate the the balance received on 24 of June , we use the following method

Because payment is made within the discount period of 10 days, the amount received is

= ($1,000 - return of $300)

Amount received= $ 700

minus the discount of $14 =

($700 × 2%),

=$ 686

for a cash amount of $686.

The amount received on June 24 is $686 as our final answer