Answer: $4,508
Explanation:
Companies usually give discounts with credit terms to encourage Receivables to pay faster.
In this scenario, credit terms of 2/10, n/30 were offered which means that if Carla Vista Company pays within 10 days they get a discount of 2% but if they don't they should pay the full amount in 30 days.
They paid within the discount period meaning that they qualify for the discount of 2% but they however returned goods worth $1800.
So calculating for that would be,
= (6,400 - 1800) (1 - 0.02)
= $4,508
The amount of the check is $4,508
Answer:
$4,508
Explanation:
Net sales before discount = $6,400 - $1,800 = $4,600
Since the credit terms is 2/10, n/30, it implies Block Company is entitled to 2% discount since it settled the account within 10 days of the discount period. Therefore, we have:
Discount = $4,600 × 2% = $92
Check amount = $4,600 - $92 = $4,508
Therefore, the amount of the check is $4,508.
