Answer:
The Patterson Corporation
The company will pay the sum of:
$3,880
Explanation:
a) Data and Calculations:
May 1 Invoice received = $4,000
Credit terms = 3/10, net 60
Payment date = May 10
Discount = $4,000 * 3% = $120
Amount paid = $4,000 97% = $3,880
b) The credit terms of 3/10, net 60 implies that there is a cash discount of 3% on the invoice amount if payment is made within 10 days of the invoice date. The credit period is only 60 days, after which, interest will be incurred.
