Question

SE ND TO FULDB DEBUDE eBook * Show Me How Calculator Determining Amounts to be paid on Invoices Determine the amount to be paid in full settlement of each of the following invoices, assuming that credit for returns and allowances was received prior to payme Invoices were paid within the discount period: Customer Merchandise Freight Paid by Seller Returns and Allowances FOB destination, 1/30 $3,250 a D. $14,000 21,200 $380 4,000 900 C d. FOB shipping point, 2/10, 1/30 FOB shipping point, 1/10, 1/30 FOB shipping point, 2/10, 1/30 16,400 7,500 28,800 1,200 FOB destination, 1/10, 130

Answer 1

In FOB Shipping Point, the ownership transfers when the shipment leaves seller’s warehouse (or shipping dock). Under FOB Destination, the title of the goods transfers at the buyer’s loading dock or warehouse.

In simple words, FOB Shipping point would be value of goods at the shipping point and any returns/damage has to be borne by the buyer whereas in case of FOB destination the returns.damage would be borne by the seller and the value of goods at the buyer's location would be considered.

n/30 means that the bill would be due in 30 days.

1/10 n/30 means that the bill would have a discount of 1% if paid within 10 days if not then it would be due in 30 days.

Like wise 2/10 n/30 would mean that the bill would have a discount of 2% if paid within 10 days if not then it would be due in 30 days.

Hence the following is the computation of amount paid in full settlement:

Example	Merchandise	Freight	Returns	Pre-Discount amount	Discount	Amount Paid
a	$14,000.00	$0.00	$3,250.00	$10,750.00	0	$10,750.00
b	$21,200.00	$380.00	$0.00	$21,580.00	2%	$21,148.40
c	$16,400.00	$0.00	$0.00	$16,400.00	1%	$16,236.00
d	$7,500.00	$250.00	$0.00	$7,750.00	2%	$7,595.00
e	$28,800.00	$0.00	$0.00	$28,800.00	1%	$28,512.00