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Question 4 Not complete Marked out of 2.00 P Flag question Accounting for Purchase Discounts Ken Company purchased 55,000 of merchandise from Marilyn Company with terms of 3/10, 1/45. What percent discount will Ken Company get if it pays within the allowed discount period? If Ken Company fails to pay within the discount period, how many days does Ken Company have from the date of purchase before the payment is considered to be late? days Check Previous a Save Answers

Answer 1

Purchase terms are 3/10, n/45.

3/10 means that discount is 3% if payment is made within 10 days of purchase.

n/45 means net of 45 i.e. no discount will be allowed if payment is made after 10 days but upto 45 days.

(i) If payment is made within the allowed discount period, discount allowed will be 3%

(ii) Ken company has 45 days to pay before the payment is considered as late.

Kindly comment if you need further assistance. Thanks