Sarah Just Received an Invoice for $12,000 with Terms of 2/10

question 72

Multiple Choice

Sarah just received an invoice for $12,000 with terms of 2/10, n/30. The invoice date was June 1. Her contract with the vendor indicates a charge of 1.5 percent per month on late payments. If Sarah pays this bill on June 15, she will send the vendor a check for

• A) $11,760.
• B) $12,000.
• C) $12,180.
• D) Cannot answer without more information.

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Definitions:

Casualty Losses

Financial losses resulting from sudden, unexpected, or unusual events such as accidents, natural disasters, or vandalism.

Multiple-Step Income Statement

An income statement that separates operating revenues and operating expenses from non-operating revenues, non-operating expenses, gains, and losses, providing a detailed analysis of income and expenses.

Gross Profit

The difference between revenue and the cost of making a product or providing a service, before deducting overhead, payroll, taxation, and interest payments.

Income for Operations

The earnings generated from a company's regular, core business activities before interest and taxes.