Purchases Transactions Xanadu Company purchased merchandise on account from Springhill Company for $9,400, terms 2/10, n/30....

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Purchases Transactions Xanadu Company purchased merchandise on account from Springhill Company for $9,400, terms 2/10, n/30. Xanadu returned merchandise with an invoice amount of $2,200 and received full credit. a. If Xanadu Company pays the invoice within the discount period, what is the amount of cash required for the payment? If required, round the answer to the nearest dollar. b. What account is debited by Xanadu Company to record the return? Accounts Payable-Springhill Company Feedback Check My Work (a) Since buyers normally take all purchase discounts, the net purchase price is recorded at the time of purchase. If the buyer makes a return of merchandise or is granted a price allowance for an invoice with a purchase discount, the amount of the return is recorded at the invoice price less the discount. (b) Any discounts or returns are recorded directly by the buyer who reduces the balances of Accounts Payable and Merchandise Inventory, using a debit memo based on the net cost of the merchandise. Purchases Transactions Xanadu Company purchased merchandise on account from Springhill Company for $9,400, terms 2/10, n/30. Xanadu returned merchandise with an invoice amount of $2,200 and received full credit. a. If Xanadu Company pays the invoice within the discount period, what is the amount of cash required for the payment? If required, round the answer to the nearest dollar. b. What account is debited by Xanadu Company to record the return? Accounts Payable-Springhill Company Feedback Check My Work (a) Since buyers normally take all purchase discounts, the net purchase price is recorded at the time of purchase. If the buyer makes a return of merchandise or is granted a price allowance for an invoice with a purchase discount, the amount of the return is recorded at the invoice price less the discount. (b) Any discounts or returns are recorded directly by the buyer who reduces the balances of Accounts Payable and Merchandise Inventory, using a debit memo based on the net cost of the merchandise.

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In the scenario described we have two main transactions to consider 1 Xanadu Company purchases merch... View the full answer