A Company Using the Perpetual Inventory System Purchased Inventory Worth

question 189

Multiple Choice

A company using the perpetual inventory system purchased inventory worth $25,000 on account with terms of 3/10,n/30.Defective inventory of $1,000 was returned two days later,and the accounts were appropriately adjusted.If the invoice is paid 10 days after the invoice date,the amount of the purchase discount that would be available to the company is ________.

• A)$720
• B)$780
• C)$750
• D)$740

---

Definitions:

APS

The ratio of savings to income, indicating the proportion of income that is saved rather than spent.

Disposable Income

Spending and saving financial pools available to households subsequent to the application of income taxes.

APC

Acronym generally referring to the Average Propensity to Consume, which is the fraction of income spent on consumption.

Disposable Income

The fiscal potential for households to undertake spending and saving after income tax considerations.