Question 1 sales with terms 2/10, n/ 30 means:

Question 1 

Sales with terms 2/ 10, n/ 30 means:

 

The buyer gets a 10 percent discount for payment within 30 days.

 The buyer gets 2 percent discount for payment within 10 days.

 The buyer gets a 10 percent discount for payment within 10 days.

 The buyer gets a 2 percent discount for payment within 30 days.

 

Question 2  

A $ 1,000 sale is made on May 1 with terms 2/ 10, n/ 30. What amount, if received on May 9, will the customer’s check be?

 

$1,000 

$ 900 

$ 980     

$ 800

 

Question 3  

A company has net sales of $500,000 and cost of goods sold of $400,000.  The company’s gross profit percentage is:

 

80% 

20%    

50% 

10%

 

Question 4  

Company Alpha has Sales of $800,000, Sales Discounts of $40,000 and Sales Returns of $50,000.  How will this be shown on the Income Statement?

 

With net sales of $710,000       

With net sales of $890,000 

With net sales of $790,000 

With net sales of $810,000

 

Question 5  

On March 1, 200X Bravo Company sells $6,000 of services on credit terms offering a 2% discount if paid within ten days. They are paid on March 3. The customer takes the discount, what is Bravo Company’s accounting entry on March 3, 200X? 

 

Debit cash $6,000; credit accounts receivable $6,000. 

Debit cash $5,880; credit accounts receivable $6,000. 

Debit cash $5,880; credit accounts receivable $5,880. 

Debit cash $5,880; debit sales discount $120; credit accounts receivable $6,000.

  

Question 6  

The accounting entry for a sales return includes:

 

A debit to the sales account and a credit to cash. 

A credit to the sales account and a debit to cash. 

A debit to the sales return account and a credit to cash. 

A credit to inventory and a debit to the sales return account.

 

 

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