accountants can you answer this??
On December 1, 2007, Cardinal Company, a garden retailer, purchased $20,000 of corn
seed, terms 2/10, n/30, from Iowa Farm Co. Even though the discount period had
expired, Sandi Kurtz subtracted the discount of $400 when she processed
the documents for payment on December 15, 2007. Discuss whether Sandi Kurtz
behaved in a professional manner by subtracting the discount, even though the discount
period had expired.
I don't know if business people are ever professional! She certainly was presumptuous. But she may get her way if she is a big customer and buys a lot from Iowa Farm. Iowa Farm may not want to risk losing her as a customer and may give her the discount as a gesture of goodwill. But if she is a small fry, Iowa can insist that she repay the balance or refuse to process her next order.
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