On January 15, Nifty Company sells merchandise on account to Martinez Associates for $3,000 with terms 3/10, n/30. On January 20, Martinez returns merchandise worth $600 to Nifty. On January 24, payment is received from Martinez for the balance due. What is the amount of cash received?

The amount of cash received is $2,328

Explanation:

In the given question, it is mentioned that the nifty company sells on January 15 for $3,000 with term 3/10, n/30, means if the payment is given within 10 days then the company will give a 3% discount.

And, on January 20, Martinez returns $600 merchandise

And on January 24., the payment is received

So, first we have to compute the net sales amount which is calculated below:

= Sales - sales return

= $3,000 - $600

= $2,400

After that apply the 3% discount on the net sales, since the payment is paid within 10 days (From January 15 to January 24)

So, the discount value would be

= $2,400 * 3%

= $72

So, the amount of cash received would be

= Net sales - discount

= $2,400 - $72

= $2,328

Hence, the amount of cash received is $2,328