A Company Using the Perpetual Inventory System Purchased Inventory Worth

question 2

Multiple Choice

A company using the perpetual inventory system purchased inventory worth $25,000 on account with terms of 2/10, n/30. Defective inventory of $2,000 was returned 2 days later and the accounts were appropriately adjusted. If the invoice is paid within 10 days, the amount of the purchase discount that would be available to the company is:

• A)$460.
• B)$540.
• C)$500.
• D)$490.

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Definitions:

Multinational Treaty

An agreement that is signed by multiple countries, establishing rights and obligations between the parties.

Patent Protection

Legal rights granted to inventors to exclusively make, use, or sell their inventions for a certain period, preventing others from doing so.

Paris Convention

An international treaty established to protect industrial property rights including patents, trademarks, and industrial designs across countries.

CISG

stands for the United Nations Convention on Contracts for the International Sale of Goods, a treaty providing a uniform international sales law.