Question

A company purchases merchandise with a catalog price of $26,500. The company receives a 30% trade discount from the seller. The seller also offers credit terms of 2/10, n/30. Assuming no returns were made and that payment was made within the discount period, what is the net cost of the merchandise?

Answer 1

Answer:

$ 18,179

Explanation:

From the list price we will apply the trade discount to know the nominal at the invoice.

Then we will apply the discount agreed on the invoice of 2% getting the net cost of the merchandise:

list price:                          26,500

trade discount of  30% =  (7,950)  

invoice nominal                18,550

discount within first 10 days:

18,550 x 2% =                       (371)

net of discount:                  18,179