In a simple structure where the owner manager makes most of the important decisions, extensive rules and regulations are used to
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Answer:
Amount of cash paid on Aug 16 = <u>$8,167.50</u>
Explanation:
As for the information provided the terms of purchase are,
1% discount if payment made within 10 days,
and a total credit period of 30 days without any discount beyond 10 days.
Here, inventory purchased on August 7 = $9,750
Less; Return on 11 August = $1,500
Net Purchases = $8,250
Since payment is made on 16 August that is within 10 days from purchase discount will be received
= $8,250 1% = $82.50
Amount of cash paid on Aug 16 = $8,250 - $82.50 = $8,167.50