{"id":214547,"date":"2025-05-15T03:40:08","date_gmt":"2025-05-15T03:40:08","guid":{"rendered":"https:\/\/learnexams.com\/blog\/?p=214547"},"modified":"2025-05-15T03:40:11","modified_gmt":"2025-05-15T03:40:11","slug":"company-purchased-1800-of-merchandise-on-july-5-with-terms-2-10-n-30","status":"publish","type":"post","link":"https:\/\/www.learnexams.com\/blog\/2025\/05\/15\/company-purchased-1800-of-merchandise-on-july-5-with-terms-2-10-n-30\/","title":{"rendered":"company purchased $1,800 of merchandise on July 5 with terms 2\/10, n\/30."},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">company purchased $1,800 of merchandise on July 5 with terms 2\/10, n\/30. On July 7, it returned $200 worth of merchandise. On July 8, it paid the full amount due. The amount of the cash paid on July 8 equals:<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">A. $200.<br>B. $1,564.<br>C. $1,568.<br>D. $1,600.<br>E. $1,80<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong><mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-ast-global-color-0-color\">The Correct Answer and Explanation is:<\/mark><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Correct Answer: C. $1,568<\/strong><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Explanation:<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">This question tests your understanding of <strong>purchase discounts<\/strong> under credit terms.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Let\u2019s break it down step by step:<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>1. Original Purchase (July 5)<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The company bought <strong>$1,800<\/strong> worth of merchandise.<\/li>\n\n\n\n<li>The terms are <strong>2\/10, n\/30<\/strong>, which means:\n<ul class=\"wp-block-list\">\n<li>The buyer gets a <strong>2% discount<\/strong> if payment is made within <strong>10 days<\/strong>.<\/li>\n\n\n\n<li>Otherwise, the full amount is due within <strong>30 days<\/strong>.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>2. Return of Merchandise (July 7)<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The company returned <strong>$200<\/strong> worth of merchandise.<\/li>\n\n\n\n<li>This reduces the balance owed:\n<ul class=\"wp-block-list\">\n<li>$1,800 &#8211; $200 = <strong>$1,600<\/strong> net amount due.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>3. Payment (July 8)<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Payment is made <strong>on July 8<\/strong>, which is <strong>within the discount period<\/strong> (10 days from July 5).<\/li>\n\n\n\n<li>Therefore, the company <strong>qualifies for the 2% discount<\/strong> on the net amount due.<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>4. Calculate the Discount<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>2% of $1,600 = 0.02 \u00d7 $1,600 = <strong>$32<\/strong><\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>5. Subtract Discount from Net Amount<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>$1,600 &#8211; $32 = <strong>$1,568<\/strong><\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\">\u2705 Final Amount Paid = <strong>$1,568<\/strong><\/h3>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Why Not the Other Options?<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>A. $200<\/strong> \u2192 This is just the returned amount, not what was paid.<\/li>\n\n\n\n<li><strong>B. $1,564<\/strong> \u2192 Incorrect discount calculation.<\/li>\n\n\n\n<li><strong>D. $1,600<\/strong> \u2192 Full amount after return, but no discount applied.<\/li>\n\n\n\n<li><strong>E. $1,80<\/strong> \u2192 Typographical error (probably meant $1,800, which was the initial purchase before returns or discounts).<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Conclusion:<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Understanding the <strong>credit terms<\/strong> is crucial. The &#8220;2\/10, n\/30&#8221; term incentivizes early payment with a discount. Since the company paid early, it earned a 2% discount on the adjusted balance after the return. That makes the correct amount paid <strong>$1,568<\/strong>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Answer: C. $1,568<\/strong> \u2705<\/p>\n","protected":false},"excerpt":{"rendered":"<p>company purchased $1,800 of merchandise on July 5 with terms 2\/10, n\/30. On July 7, it returned $200 worth of merchandise. On July 8, it paid the full amount due. The amount of the cash paid on July 8 equals: A. $200.B. $1,564.C. $1,568.D. $1,600.E. $1,80 The Correct Answer and Explanation is: Correct Answer: C. [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[25],"tags":[],"class_list":["post-214547","post","type-post","status-publish","format-standard","hentry","category-exams-certification"],"_links":{"self":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/214547","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/comments?post=214547"}],"version-history":[{"count":0,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/214547\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/media?parent=214547"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/categories?post=214547"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/tags?post=214547"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}