An Invoice for $2,500 Dated September 15 with Terms 2/10

question 256

Multiple Choice

An invoice for $2,500 dated September 15 with terms 2/10, 1½/20, n/30, EOM is received in the mail on September 18. What payment will settle the invoice on October 11?

• A) $2,450.00
• B) $2,500.00
• C) $2,200.00
• D) $2,462.50
• E) $2,125.00

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Definitions:

Supplies Variance

The difference between the budgeted cost of supplies and the actual cost incurred.

Materials Price Variance

The difference between the actual cost of materials used in production and the expected (or standard) cost, which can indicate changes in market prices or issues with budgeting.

Raw Material

Basic materials that are used in the production process to manufacture goods.

Variable Overhead Rate

The rate at which variable overhead costs are allocated to each unit of production, which may vary with the level of output.