Tamara Muldoon Received an Invoice Dated October 25th with Terms

question 8

Multiple Choice

Tamara Muldoon received an invoice dated October 25th with terms of 2/10, n/30 EOM. If Tamara wishes to pay the bill on the last day of the discount period, what date would she pay the invoice?

• A) December 10
• B) November 30
• C) November 4
• D) November 10

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Definitions:

Purchase Order

An official document issued by a buyer committing to pay the seller for the sale of specific products or services.

Fair-value Hedge

A hedge of the exposure to changes in the fair value of an asset or liability or an unidentified firm commitment that could affect profit or loss.

Drilling Machine

A tool used for making holes in various materials, part of machinery equipment.

Forward Contract

A financial agreement between two parties to buy or sell an asset at a predetermined future date and price.