The Lemon Company made a credit sale of $20,000. The invoice was sent today with the terms,

Question:

The Lemon Company made a credit sale of $20,000. The invoice was sent today with the terms, 3/10 net 30. This customer normally pays at the net date. If your opportunity cost of funds is 10% the expected payment is worth how much today?

A. $15,000

B. $15,657

C. $19,843

D. $20,000

E. None of the above.

Opportunity Cost
Opportunity cost is the profit lost when one alternative is selected over another. The Opportunity Cost refers to the expected returns from the second best alternative use of resources that are foregone due to the scarcity of resources such as land,...