Cash Discount and Remittance calculations
For each of the following May Paz Abad Retailers purchases, assume that credit terms are 2/10, n/30 and that any credit memorandum was issued and known before Mary Paz Abad Retailers made the payments.
|
|
|
Prepaid |
|
|
Purchases |
Shipping Terms |
Freight |
Credit |
| a |
P 12,000 |
FOB shipping point |
(by seller) |
Memo |
| b. |
24,000 |
FOB destination |
P 1,000 |
P 3,000 |
| c. |
28,000 |
FOB shipping point |
2,400 |
2,000 |
| d. |
40,000 |
FOB shipping point |
|
4,000 |
Required:
1. Determine the cash discount available.
2. Determine the cash remitted if the payment is made within the discount period.