Total gross sales for the period include the following:


Credit card sales (discount 3%) $ 9,400
Sales on account (2/15, n/60) $ 10,500


Sales returns related to sales on account were $500. All returns were made before payment. One-half of the remaining sales on account were paid within the discount period. The company treats all discounts and returns as contra-revenues.


What amount will be reported on the income statement as net sales?

Lets say Credit Card Sales ( Discount 3%) $ 9400 * .03 = 282 DISCOUNT
Sales 9118

Sales on Account (2/15 n/60) $ 10500
Sales returns related to sales on account were $500
Remaining sales on account $ 10000 (2/15 n/60)

One-half of the remaining sales on account were paid within the discount period
One half is $ 5000 we calculated 2/15
It comes to $ 100 discount for early payment
Comes to $ 4900

Remainging $ 5000 sales will be $ 5000


So
Sales 9400 + 10500
Sales Returns and Allowances ($ 500)
Sales Discounts ( $ 382)
Net Sales $ 19018
COGS (x)
GROSS PROFIT ON SALE (X)

But usually companies don't give discounts to use credit card. Because Credit Card companies charge fees to business too.


Hope if make sense