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3 February, 10:26

On January 15, Walton Company sold merchandise on account for $3,000 with terms 3/10, n/30. On January 20, the customer returns merchandise with an invoice price of $600. On January 25, the customer pays the balance due. What is the amount of cash received by Walton Company?

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  1. 3 February, 10:31
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    The amount received in cash is $2,328

    Explanation:

    The amount which is received in cash is computed as:

    On January 20, the amount of $600 goods returns from customer, so the remaining balance is

    = $3,000 - $600

    = $2,400

    On the remaining balance, the discount which is evaluated as the payment is received within the discount period which is January 25. So,

    = $2,400 x (100% - 3%)

    = $ 2,400 x 97%

    = $ 2,328
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Home » Business » On January 15, Walton Company sold merchandise on account for $3,000 with terms 3/10, n/30. On January 20, the customer returns merchandise with an invoice price of $600. On January 25, the customer pays the balance due.
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