A Company That Uses a Perpetual Inventory System Purchased $1,800

question 40

Multiple Choice

A company that uses a perpetual inventory system purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. On July 7, it returned $200 worth of merchandise. On July 28, it paid the amount due. The amount of the discount lost by failing to pay within the discount period equals:

• A)$32.
• B)$36.
• C)$4.
• D)$40.
• E)$200.

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Definitions:

National Income

The total monetary value of all goods and services produced over a specific time period within a country’s borders, used as an indicator of economic health.

India

A country in South Asia, known for its diverse cultures, languages, religions, and history, and is the world's largest democracy.

Castes

A system of social stratification characterized by hereditary status, endogamy, and social barriers sanctioned by customs, law, or religion.

Society

denotes a group of individuals living together in a more or less ordered community, sharing customs, laws, and organizations.