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Wills sells $600 of merchandise on account to Benton Company with credit terms of 1/10, n/30. If Benton Company remits a check taking advantage of the discount offered, what is the amount of the check?

Answer :

Final answer:

The credit terms 1/10, n/30 offer a 1% discount if payment is made within 10 days. Therefore, if the Benton Company takes advantage of this, the check amount will be $594, which is $600 minus the $6 discount.

Explanation:

The credit terms 1/10, n/30 mean that Benton can take a 1% discount off the $600 if they pay within 10 days. If they decide to take advantage of this discount, they would subtract 1% from the $600. Thus, 1% of $600 is $6. So, if Benton Company remits a check taking advantage of the discount, it would be for the amount of $600 - $6 = $594. Therefore, the amount of Wills Company's check would be $594.

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