Scarlet Company received an invoice for $67,000.00 that had payment terms of 3/5 n/30. If it made a partial payment of $14,900.00 during the discount period, calculate the balance of the invoice.
Solution:
GIVEN,
Invoice amount = $67,000
Partial payment = $14,900
Discount rate = 3% = 0.03
Now,
Calculating the balance of the invoice,
Balance of the invoice = Invoice amount - Partial payment - ( Partial payment * Discount rate )
Balance of the invoice = $67,000 - $14,900 - ( $14,900 * 0.03)
Balance of the invoice = $67,000 - $14,900 - $447
Balance of the invoice = $51,653
Hence, the balance of the invoice is $51,653