Problema Solution
The Empire Carpet Company orders merchandise for $17,700, including $550 in shipping charges, from Mohawk Carpet Mills on May 4. Carpets valued at $1,390 will be returned because they are damaged. The terms of sale are 2/10, n30 ROG. The shipment arrives on May 26 and Empire wants to take advantage of the cash discount. By what date must Empire pay the invoice?
Using the scenario from the question above, imagine you are the bookkeeper for Empire. How much money will you send to Mohawk?
Answer provided by our tutors
Given this,
10/n30 ROG means that the buyer receives a 2% discount if the invoice is paid within 10 days of the date the buyer receives the goods.
Then, it will be in 30 days after receipt. ROG= receipt of goods.
Add 10 days to May 26 and you'll get June 5th. The amount of the discount is [($17,700 - $1,390) x 2%] = $326.20.