User Account

All Pages

Explain between a term discount vs a trade discount

Assignment Help Financial Accounting
Reference no: EM132983996

Aug 1: Received $11,500 cash from a debtor in full settlement of its account that had a balance of $11,750, the difference is to be treated as a term (settlement) discount.

Aug 3: Purchased 75 tints on credit for $4,875

Aug 8: Sold 100 tints for a total of $12,500 (before discount) on credit. The customer was given an initial trade discount of 5%, then the normal credit terms of 3/10 nil/30. The cost of sale is $6,000

Aug 20: Paid Utility bills (Water and electricity) for the month of August for $800

Aug 23: Paid creditors $8,500 in full settlement of account owing of $8,900, the difference is to be treated as a settlement discount.

Aug 30: Received the telephone account for the month of March for $550, the business will pay this account in Sept 5.

Problem 1: Explain in your own words the main difference between a term discount (sometimes called a settlement or cash discount) and a trade discount

Reference no: EM132983996

Questions Cloud

What is a social enterprise : What are the key differences between social enterprises and conventional, institutional and cultural entrepreneurship? What are the five components of social
International marketing case analysis : International Marketing Case Analysis Task - Discuss the key concepts of international marketing, and their importance to businesses and the world economy
Should purchase machine a or machine b : Tommy must choose between two machines. If there are no taxes, and Tommy's required rate of return is 10% p.a., should he purchase machine A or machine B?
Solve the expected return of a portfolio : The covariance of returns, Calculate the expected return and standard deviation of a portfolio consisting of $50,000 in Share A and $100,000 in Share B.
Explain between a term discount vs a trade discount : Explain in your own words the main difference between a term discount (sometimes called a settlement or cash discount) and a trade discount
Prepare general journal entries for paula paint in the space : Prepare General Journal entries for Paula's Paint in the spaces provided to record the following transactions for the month of August 2020.
Explain what at-risk limitation is : Explain what at-risk limitation is. What gave rise to the law change creating the rules that implement the at-risk limitation? Who is impacted by these rules?
Explain how the should be treated in the financial statement : Craneland Business Enterprise Ltd (CBEL) is incorporated in Uganda. Explain how the should be treated in the financial statements
How transaction should be reflected in financial statements : Explain, based on the information available, how this transaction should be reflected in the financial statements of Metal Works for the year ended 31 December

Reviews

Write a Review

Financial Accounting Questions & Answers

  Which category of the coso internal control framework

Which category of the COSO internal control framework? The CEO hires an external consultancy firm to run a one-day training for the board of directors

  What seller records payment of transportation costs by debit

When the seller advances the transportation costs and the terms of sale are FOB shipping point, the seller records payment of the transportation costs by debit

  What is the total cost of job

In June, Sierra Company worked only on Job No. 100 and completed it on June 30. There were no prior costs accumulated on Job No. 100 before June 1. During the month, the company purchased and used $10,800 of direct materials, used 2,000 machine-hours..

  What is the annual margin for a customer

Michelle is the director of marketing for M&J Jewelry, a direct-mail jewelry business that sells high-end costume jewelry via monthly catalogs. She wants to better understand the lifetime value of the customers who buy jewelry from M&J so that she ca..

  Explain role of audit committees in corporate governance

Explain role of audit committees in corporate governance. Explain the role of organisations in the international regulatory framework for accounting

  What factors prevent person from simply providing potential

What factors prevent a person from simply providing potential lenders with misleading financial statements to make the company look like a risk-free investment?

  What is the fixed cost per unit and variable cost per unit

If the Flash corporation makes 400,000 units, what is the fixed cost per unit and variable cost per unit? Calculate the variable cost per unit.

  Critically analyse key financial ratios for AMP Limited

Identify and critically analyse key financial ratios for AMP Limited. Outline and discuss any significant changes to have occurred to firm's capital structre

  Is the negative net income sustainable in the long term

It has a positive Gross Profit, positive Operating Income, and negative Income Before Taxes. Is the negative Net Income sustainable in the long term?

  Which statements is true with respect to financial stability

Which statements is true with respect to financial stability? Financial stability ratios provide a basis for determining a company's capacity to improve sales.

  Find the free cash-flow for the first year of the project

As you plan for a new corporate project, Given a corporate tax rate of 40%, find the free cash-flow for the first year of the project.

  How the book came up with this slope

The relative cost of wheat into autos (slope of the line) is .33 bushels of wheat. So, to produce one auto, the nation needs to give up .33 bushels of wheat? How the book came up with this slope? Why is not 18/5= 3.6 the slope?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd