Question

In: Accounting

1) Credit terms that allow for a 4% discount for early payment : a- 2/10, N/60...

1) Credit terms that allow for a 4% discount for early payment :
a- 2/10, N/60
b- n/45
c- FOB destination
d- FOB shipping point
e- 4/10, N/45

2) Shipping terms that would typically mean that the seller has to pay the freight charges :

a- 2/10, N/60
b- n/45
c- FOB destination
d- FOB shipping point
e- 4/10, N/45

3) Credit terms that allow for a 2% discount for early payment:

a- 2/10, N/60
b- n/45
c- FOB destination
d- FOB shipping point
e- 4/10, N/45

4) Credit terms that do not provide a discount for early payment :
a- 2/10, N/60
b- n/45
c- FOB destination
d- FOB shipping point
e- 4/10, N/45

5) Shipping terms that would typically mean that the buyer has to pay the freight charges:

a- 2/10, N/60
b- n/45
c- FOB destination
d- FOB shipping point
e- 4/10, N/45

Solutions

Expert Solution

1- (e)4/10,n/45,

it signifies that discount of 4% that the buyer is entitled to, if payment is made within 10 days of invoice being raised. In the event amount is not paid with in 10days then full amount is required to be paid with in 45 days.

2- (d) FOB shipping point

Where freight charges are to be paid by the supplier at the time of shippment it is freight on board at shipping point

3- (a) 2/10,n/60

it signifies that discount of 2% that the buyer is entitled to, if payment is made within 10 days of invoice being raised. In the event amount is not paid with in 10days then full amount is required to be paid with in 60 days

4- (b) n/45

It signifies that there is no discount allowed to the buyer in case of early payment, full amount is to be paid in 45 days

5- (c) FOB destination

Where freight charges to be paid by buyer at the delivery of goods at Port as per agreement is freight on board (FOB) destination.

ekkarill92 answered 2 years ago
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