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8 Cards in this Set
- Front
- Back
2/10, n/30
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discount percentage, # of days in discount period, net (total sales less returns), Maximum days in credit period
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interest rate for 20 days=
annual interest rate= |
amount saved/amount paid
365 days/20days * percentage |
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reporting net sales
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Sales revenue
Less: Credit card discounts Sales discounts Sales returns and allowances ______________________________________ net sales |
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gross profit percentage=
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gross profit/net sales
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bad debts
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result from credit customers who won't pay, it's matched with the sales revenue in the same period. most business estimate it.
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bad debt
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bad debt expense. determine the desired balance in the allowance for doubtful accounts. accounts are aged by breaking down the balance by showing the age in balance
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receivables turnover=
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net sales/ average net trade receivables
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average collection period=
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365/ receivables turnover
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