Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On October 22, Zone Company placed an order to purchase merchandise with payment terms of 2/10, n/30. The goods were listed by Danger (the seller)

On October 22, Zone Company placed an order to purchase merchandise with payment terms of 2/10, n/30. The goods were listed by Danger (the seller) in the companys catalog at a selling price of $15,500. The goods were carried on Dangers balance sheet at a historical cost of $4,800. Zone obtained a 6% trade discount. Danger shipped the goods to Zone on November 2 with shipping terms of FOB Shipping Point and $900 of prepaid freight. The goods arrived at Zones facility on November 5. Zone returned $5,270* of goods and paid the balance due to Danger on November 9.

*returned units had an original cost to Danger of $1,920

How much Sales Revenue will Danger report on the company's income statement as a result of this transaction? (Round your final answers to the nearest $1).

On October 22, Zone Company placed an order to purchase merchandise with payment terms of 2/10, n/30. The goods were listed by Danger (the seller) in the companys catalog at a selling price of $15,500. The goods were carried on Dangers balance sheet at a historical cost of $4,800. Zone obtained a 6% trade discount. Danger shipped the goods to Zone on November 2 with shipping terms of FOB Shipping Point and $900 of prepaid freight. The goods arrived at Zones facility on November 5. Zone returned $5,270* of goods and paid the balance due to Danger on November 9.

*returned units had an original cost to Danger of $1,920

How much Gross Profit will Danger report on the company's income statement as a result of this transaction? (Round your final answers to the nearest $1).

A.

None of the answer choices provided are correct.

B.

$6,234

C.

$5,216

D.

$4,316

E.

$6,420

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Information For Decision Making Readings In Cost And Managerial Accounting

Authors: Alfred Rappaport

3rd Edition

0134643542, 978-0134643540

More Books

Students also viewed these Accounting questions

Question

Understand a department managers role in locating job candidates

Answered: 1 week ago