Question

In: Accounting

McMahon Company on July 15 sells merchandise on account to Swift Co. for $3,000, terms 2/10, n/30. On July 20

 McMahon Company on July 15 sells merchandise on account to Swift Co. for $3,000, terms 2/10, n/30. On July 20, Swift Co. returns merchandise worth $1,200 to McMahon Company. On July 24, payment is received from Swift Co. for the balance due. What is the amount of cash received?

 A $1,800

 B $1,764

 C $1,740

 D $3,000

Solutions

Expert Solution

Net sales = Total sales - sales return

= $3,000 - 1,200

= $1,800

Cash discount = Net sales x discount rate

= $1,800 x 2%

= $36

Amount of cash received = Net sales - Cash discount

= $1,800 - 36

= $1,764

Option B. $1,764 is the correct answer.

Option B. $1,764 is the correct answer.

DEEPIKA GOYAL answered 2 years ago
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