Merchandise is sold on account to a customer for $56,500, terms FOB shipping point, 2/10, n/30.

Merchandise is sold on account to a customer for $56,500, terms FOB shipping point, 2/10, n/30. The seller paid the freight of $2,100. Determine the following: (a) amount of the sale, (b) amount debited to Accounts Receivable, and (c) amount received within the discount period.

Answer:

a. $55,370 [$56,500 – ($56,500 × 2%)]

b. $57,470 ($55,370 + $2,100)

c. $57,470