JAMB Accounts Principles of Accounts 2014 Paper

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Question : 16

Total: 49

If goods were bought from Tanko at a cost price of #9,000 with a cash discount of 5%, how much will be paid assuming prompt payment was made?

#4,500
#8,550
#9,000
#9,450

Solution:

Concept:

Cash discount reduces the amount payable by a percentage of the cost price.

Explanation:

Cost price = #9,000

Cash discount =

5\%

of #9,000 = #450

Amount payable = #9,000 - #450 = #8,550

Answer:

#8,550

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