Willetta Company purchases inventory for $18,000 with terms 2/10, n/30. It then returns $2,800 of the inventory purchased to the supplier and also receives an allowance for defective inventory of $180. The company pays the amount due within the discount period. What is the amount of the discount that will be taken? (Round your answer to the nearest dollar amount.)

The amount of discount that will be taken is $300.4

Explanation:

The amount of discount that will be taken will be on the value of accounts payable that is eligible for pay after adjustments.

The accounts receivable balance after adjusting for purchases returns and defective goods is:

Accounts receivables eligible for payment = 18000 - 2800 - 180 = $15020

The accounts payable amount that is eligible for discount is:

Discount received = 15020 * 0.02 = $300.4

in 2001, dell computer became the world’s largest personal computer vendor, continuing to

gain market share and post profits in an industry struggling with slumping sales and billions of

dollars in losses. dell sells 90% of its pcs directly to the final customer, largely bypassing the

reseller channel that accounts for most of the world’s pc sales. this direct customer relationship

is the key to dell’s business model, and provides distinct advantages over the indirect sales

model. dell’s direct relationship with the customer allows it to tailor its offerings to customer

needs, offer add-on products and services, and use the internet to offer a variety of customer

services. in addition, dell’s pcs are built to customers’ specifications upon receipt of an order,

giving dell additional advantages over indirect pc vendors who must try to forecast demand and

ship products based on those forecasts. dell’s direct sales and build-to-order model has achieved

superior performance in the pc industry in terms of inventory turnover, reduced overhead, cash

conversion, and return on investment (kraemer, et al., 2000).

explanation: