May Retailers Purchased Merchandise with a List Price of $100,000,subject

question 88

Multiple Choice

May Retailers purchased merchandise with a list price of $100,000,subject to a trade discount of 20 percent and credit terms of 2/10,n/30.At what amount should May record the cost of this merchandise if the gross method is used?

• A) $100,000
• B) $78,400
• C) $98,000
• D) $80,000

---

Definitions:

Senior Management

The highest level of management in an organization comprised of individuals who are responsible for strategic decision-making and its implementation.

Global Public Relations

The practice of managing the spread of information between an organization and the public on a global scale.

Socioeconomic

Relating to or concerned with the interaction of social and economic factors.

Halo Effect

The positive bias shown by customers toward certain products because of a favorable experience with other products made by the same manufacturer.