Cm2 Unit 2 Case Study

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Currently CM2 offers a sales incentive to a few select customers the presesent terms 1/10, n/20. This means the customer will receive a 1% discount if their invoice is paid within 10 days if not before 10 days the full amount is due with in 30 days. One of the purposed changes to sales incteive would be to offer all customer 2/10, n/30. This would mean if invoices are paid with is 10 days’ customers will receive a 2% discount. If 2/10, n/30 becomes the new cash discount and an invoice is paid within 10 days the business would need to credit an offset entry. The entry would be a credit to account receivables for the full invoice balance, a credit to sales discount and cash. These adjustments would no effect on the balance sheet. The other suggested

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