A Fort Myers supplier invoice is $18,750 with terms 2/10, net 30. If the bookkeeper releases payment within the discount period, what amount should be paid?
Correct Answer
B) $18,375.00
A 2% discount on $18,750 is $375, so the discounted payment is $18,375.
Why This Is the Correct Answer
A 2% discount on $18,750 is $375, so the discounted payment is $18,375.
Why the Other Options Are Wrong
Option A: $18,000.00
$18,000.00 is below the supported result for accounts payable discount; it likely uses the wrong base, period, or account bucket.
Option C: $18,562.50
$18,562.50 is above the supported result for accounts payable discount; it likely adds an unsupported amount or compares the wrong financial base.
Option D: $18,750.00
$18,750.00 is above the supported result for accounts payable discount; it likely adds an unsupported amount or compares the wrong financial base.
Memory Technique
Accounts Payable drawer for Approving School: label discount before counting dollars.
Reference Hint
Open-book path: tab Builder's Guide to Accounting, 2001 to Section Two, Check Writing and Recording, Paying Accounts Payable; use the job ledger figures in the stem and recompute the same accounting measure.
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