On June 1, 2023, AAA Company sold merchandise with an invoice price of 5,000,000 to a customer. The entity allowed trade discounts of 15%, and 10%. Credit terms were 3/10, n/30 and the sale was made FOB destination. AAA Company paid 100,000 of the delivery cost.a. Compute the total amount of purchases to be included on the buyer’s inventory in the determination of cost of goods available for sale if payment was made beyond the discount period. b. What is the full amount received by AAA company if payment was made on June 11, 2023? 1. On June 1, 2023, AAA Company sold merchandise with an invoice price of 5,000,000 toa customer. The entity allowed trade discounts of 15%, and 10%. Credit terms were3/10, n/30 and the sale was made FOB destination. AAA Company paid 100,000 of thedelivery cost.a. Compute the total amount of purchases to be included on the buyer's inventory inthe determination of cost of goods available for sale if payment was madebeyond the discount period.b. What is the full amount received by AAA company if payment was made on June11, 2023?

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Answered: On June 1, 2023, AAA Company sold…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter6: Cash And Receivables

Section: Chapter Questions

Problem 6E

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On June 1, 2023, AAA Company sold merchandise with an invoice price of 5,000,000 to a customer. The entity allowed trade discounts of 15%, and 10%. Credit terms were 3/10, n/30 and the sale was made FOB destination. AAA Company paid 100,000 of the delivery cost.

a. Compute the total amount of purchases to be included on the buyer’s inventory in the determination of cost of goods available for sale if payment was made beyond the discount period.

b. What is the full amount received by AAA company if payment was made on June 11, 2023?

1. On June 1, 2023, AAA Company sold merchandise with an invoice price of 5,000,000 to
a customer. The entity allowed trade discounts of 15%, and 10%. Credit terms were
3/10, n/30 and the sale was made FOB destination. AAA Company paid 100,000 of the
delivery cost.
a. Compute the total amount of purchases to be included on the buyer's inventory in
the determination of cost of goods available for sale if payment was made
beyond the discount period.
b. What is the full amount received by AAA company if payment was made on June
11, 2023?

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