What is the net amount of cash paid to the supplier if: Credit purchases $12,000 out of which $2,000 were rejected and subsequently returned to the supplier. Supplier allowed a discount of 1% on settlement of amount.

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Q. What is the net amount of cash paid to the supplier if: Credit purchases $12,000 out of which $2,000 were rejected and subsequently returned to the supplier. Supplier allowed a discount of 1% on settlement of amount.
(A) $10,000
(B) $12,000
(C) $9,900
(D) $11,880

The answer is: (C) $9,900
12,000–2,000=10,000. Now, 1% of 10,000 is 100. So, 10,000–100=$9900
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