Mike Returned $300 of Merchandise to Secret Trails

question 6

Multiple Choice

Mike returned $300 of merchandise to Secret Trails. His original purchase was $600, with terms 1/10, n/30. If Mike pays the balance of his account after the discount period, how much should he pay? (Round your calculations to the nearest whole dollar.)

• A) $306
• B) $294
• C) $300
• D) $600

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Definitions:

Debt to Assets Ratio

A financial metric measuring the proportion of a company's total assets financed through debt, indicating financial leverage and risk.

Times Interest Earned

A financial ratio that measures a company's ability to meet its debt obligations based on its current income, indicating financial stability against interest charges.

Coupon Interest Rate

The fixed rate of interest paid by a bond to its holder at specified intervals until maturity.

Market Interest Rate

The prevailing rate of interest determined by supply and demand in the money market that borrowers must pay and lenders receive.