"Relay Corporation provides services with a normal price of $105,000 and a trade discount of $5,000. Terms are 1/10, n/30 and the customers pay within 10 days. The net service revenue is"

Answer

The net service revenue is $99,000.

Explanation

Net sales is calculated by deducting all the discount from the sales value. In this question Trade discount is deducted first and then there is an offer of 1% discount if payment is made within 10 days of sale. The payment is made within the discount period, so, the receipt is eligible for 1% discount. after deducting both discounts Net sales is $99,000.

Sales = $105,000

Sales Net of Trade discount = $105,000 - $5,000

Gross Sales = $100,000

Cash / Settlement discount = 1% of Gross sales = 0.01 x $100,000 = $1,000

Net Sales = $100,000 - $100,000 = $99,000

answer; /// the above statement is (true);