A Company That Foregoes a Discount of 1/7 Net 30

question 77

Multiple Choice

A company that foregoes a discount of 1/7 net 30 is essentially borrowing money from the vendor at

• A) 1%.
• B) 12.29%.
• C) 16.03%.
• D) 52.7%.

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Definitions:

Financial Statements

Documents and records that provide an overview of a company’s financial condition, including balance sheets, income statements, and cash flow statements.

Subscription

An agreement to receive or be able to access a product or service, typically on a recurring basis, such as monthly or yearly.

Entries

Refers to individual records of financial transactions in accounting, documented in journals and ledgers.

Check

A written, dated, and signed instrument that contains an unconditional order from the drawer that directs a bank to pay a definite sum of money to a payee.