1) M. Freeman received an invoice from D. Wayans Automotive Parts. The invoice stated the total of $52,000 for twelve pairs of Corvette fenders with the terms 2/10, n/30 printed at the bottom. If Mr. Freeman wishes to take advantage of the discount associated with this item, how much and by when does he need to pay?

	A.	$50,960 must be paid within 30 days
	B.	$44,200 must be paid within 30 days
	C.	$50,960 must be paid within 10 days
	D.	$47,628 must be paid within 15 days

2) Please use the information in the preceding question regarding M. Freeman's purchase of auto parts from D. Wayans.

If Freeman utilizes the perpetual inventory method and pays their invoice, utilizing the discount noted in the terms, what would be the journal entry to record the payment?

*none of the goods were returned prior to payment and the seller paid for all shipping.

M. Freeman Automotive Repair
Item	Account Name	Post Ref	Debit	Credit
1.	Cash		$52,000
	Merchandise Inventory			$52,000
2.	Accounts Payable		$52,000
	Merchandise Inventory			$1,040
	Cash			$50,960
3.	Accounts Payable		$44,200
	Cash			$36,400
	Discount on Accounts Payable			$7,800
4.	Accounts Payable		$44,200
	Cash			$44,200

	A.	Item # 1 is the correct journal entry
	B.	Item # 4 is the correct journal entry
	C.	Item # 3 is the correct journal entry
	D.	Item # 2 is the correct journal entry