Question
Company A sold merchandise with a list price of $4,200 and costing $2,300 on account to Company B. The sale was subject to the following
Company A sold merchandise with a list price of $4,200 and costing $2,300 on account to Company B. The sale was subject to the following terms: FOB destination, 2/10, n/30. Company A prepays the freight costs of $85 (debit Delivery Expense for the freight costs). Prior to payment for the goods, Company A issues a credit memo for $750 to Company B for merchandise costing $425 that is returned. Company A received payment from Company B within the discount period. Company A uses a perpetual inventory system. Which of the following statements is true about the amount Company A receives from Company B for the sale?
None of these answers are correct.
The invoice amount is greater than $3,500 and less than $3,600.
The invoice amount is greater than $3,400 and less than $3,500.
The invoice amount is greater than $3,300 and less than $3,400.
The invoice amount is greater than $2,700 and less than $2,800.
The invoice amount is greater than $3,100 and less than $3,200.
The invoice amount is greater than $2,900 and less than $3,000.
The invoice amount is greater than $3,000 and less than $3,100.
The invoice amount is greater than $3,200 and less than $3,300.
The invoice amount is greater than $2,800 and less than $2,900.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started