Complete the following by calculating the cash discount and net amount paid:

Question

1. Gross amount of invoice (freight charge already included) - $7,000
2. Freight Charge - $100
3. Date of invoice - 4/8
4. Term of invoice - 2/10, n/60
5. Date of payment - 4/15
6. Cash discount - $_____
7. Net amount paid - $_____

Answer 1

Complete the following by calculating the cash discount and net amount paid:

1. Gross amount of invoice (freight charge already included) - $7,000
2. Freight Charge - $100
3. Date of invoice - 4/8
4. Term of invoice - 2/10, n/60
5. Date of payment - 4/15
6. Cash discount - $140
7. Net amount paid - $6860

Upon purchase

Dr Inventory 7000

Cr Accounts Payable 7000

To record goods purchased on account.

Upon Payment

Dr Accounts Payable 7000

Cr Cash 6860

Cr Inventory 140

To record payment within the discount period