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7 April, 15:19

Banks Company sold merchandise on account for $35,000 with terms 2/10, n/30. The cost of goods sold was $27,600. If the invoice is paid within the discount period, what is the amount of cash received by Banks Company?

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  1. 7 April, 15:35
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    The amount of cash received by Banks Company is $34,300

    Explanation:

    The computation of the cash received by the bank company is shown below:

    = Merchandise amount - discount

    where,

    Merchandise amount is $35,000

    And, the discount equal to

    = Merchandise amount * discount percentage

    = $35,000 * 2%

    = $700

    Now put these values to the above formula

    So, the value would equal to

    = $35,000 - $700

    = $34,300
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