Question

sold inventory for $ 280 comma 000​, terms 4​/10, ​n/30. Cost of goods sold was $ 160 comma 000. How much sales revenue will Old Oak Winery report from the​ sale? ​(Assume the company records sales at the net​ amount.) A. $ 268 comma 800 B. $ 280 comma 000 C. $ 120 comma 000 D. $ 160 comma 000

Answer 1

Answer:

A. $ 268,800

Explanation:

According to the net method,

A company will report the sales after deducting the discount (if there is any discount term is given) assuming that the buyer will pay the money within the discounting period.

Therefore, Old Oak Winery will report the sale as follows:

Sales revenue                                            = $280,000

Less: Sales discount ($280,000 × 4%)     = $    11,200

Net Sales revenue                                     = $268,800

Hence, option A is correct.