An Invoice for $35,000 Dated March 15 with Terms 3/10

question 239

Multiple Choice

An invoice for $35,000 dated March 15 with terms 3/10, 2/20, n/30, ROG was received in the mail on March 18. The shipment of goods was received on April 3. What payment April 14 would reduce the outstanding balance to $25,000?

• A) $9,700
• B) $10,000
• C) $9800
• D) $10,200
• E) $10,300

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Definitions:

Prepaid Asset

Expenses paid in advance and recorded as assets before they are used or consumed.

Pre-Tax Book Income

The income of a company before taxes as reported in its financial statements, according to accounting principles.

Taxable Income

Income on which tax must be paid. Total income minus exemptions and deductions is used to calculate this figure.

Income Tax Expense

The amount of expense recognized in a given period for taxes on profits, reflecting the expected cash outflow to tax entities.