Question
In: Accounting
Jordan’s of Boston sold Lee Company of New York computer equipment with a $7,000 list price. Sale terms were 4/10, n/30 FOB Boston. Jordan’s agreed to prepay the $400 freight. Lee pays the invoice within the discount period. What does Lee pay Jordan’s?
Jordan’s of Boston sold Lee Company of New York computer equipment with a $7,000 list price. Sale terms were 4/10, n/30 FOB Boston. Jordan’s agreed to prepay the $400 freight. Lee pays the invoice within the discount period. What does Lee pay Jordan’s?
Solutions
Expert Solution
Equipment List Price = $7,000
Jordon's agreed to prepay the $400 Freight as the sales terms are FOB shipping point .
Therefore , Invoice value of equipment = $7,000 + $400
= $7,400
Lee pays within discount period i.e., 4/10,n/30.
Discount will be only on price and not Freight charges .
Discount = $7,000 x $4% = 280
The amount Lee pays to Jordan is
= $7400 - $280
= $7,120.
The amount Lee pays to Jordan is $7,120.
Shaik sultan answered 3 years agoRelated Solutions
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