1. A retailer is considering the purchases of 100 units of a specific item from either of two suppliers. their offers are as follows:
a. $200 a unit, total of $20,000, 2/10,n/30, no charge for freight.
b. $195 a unit, total of $19,500, 1/10,n/30, plus freight of $400.
which of the two offers, A or B, yields the lower price?
2. Illustrate the effects on the accounts and financial statements of the following related transactions of Westcoast Diagnostic Company:
a. purchased $ 25,000 of merchandise from presidio co. on account, terms 2/10, n/30.
b. paid the amount owed on the invoice within the discount period.
c. discovered that $ 5,000 of the merchandise was defective and returned items receiving credit.
d. purchased $ 4,000 of merchandise from presido co. on account, terms n/30.
e. received a check for the balance owed from the retune in (c), after deducing for the purchase in (d).