Exhibit 7-2 Edwards Co. Purchased Raw Materials with a Cost of $95,000

question 21

Multiple Choice

Exhibit 7-2
Edwards Co. purchased raw materials with a cost of $95,000 on March 2, 2015. Credit terms of 3/20, n/60 applied.
-Refer to Exhibit 7-2. If Edwards uses the net method and pays for the purchase on March 31, 2015, what amount is recorded in the Purchase Discounts Lost account?

• A) $0
• B) $2,850
• C) $4,000
• D) $8,000

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Definitions:

Quantifier

A symbol or word used in logic to express the quantity of specimens that a proposition pertains to, such as "all", "some", or "none".

Atomic Open Sentence

In logic, an open sentence containing no quantifiers or connectives, which may become a proposition when variables are substituted.

Compound

A substance formed from two or more elements chemically united in fixed proportions; or, in a linguistic context, a term made up of two or more words functioning as a single unit.

Atomic

Constituting an undivided whole; elementary, with reference to particles or concepts.