An Invoice for $50,000 Dated March 15 with Terms 3/10

question 11

Multiple Choice

An invoice for $50,000 dated March 15 with terms 3/10, 2/20, n/30 is received in the mail on March 17. If the company wants to reduce the outstanding balance to $25,000, how much should they pay on March 26?

• A) $24,250
• B) $25,000
• C) $24,500
• D) $25,500
• E) $25,750

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Definitions:

Tax-Exempt

A status that exempts an individual or entity from having to pay federal, state, or local taxes.

Private Activities

Activities undertaken by private individuals or entities as opposed to those initiated or conducted by governmental bodies or public institutions.

Convention Centers

Large facilities designed to host conferences, exhibitions, and large events, often featuring a variety of spaces including auditoriums, exhibit halls, and meeting rooms.

Cash-Basis Taxpayer

A Cash-Basis Taxpayer is an individual or business that reports income and deductions in the year that they are actually received or paid, as opposed to when they are earned or incurred.