Levin Furniture buys a living room set with a $4,000 list price and a 55% trade discount. Freight (FOB shipping point) of $50 is not part of the list price. What is the delivered price (including freight) of the living room set, assuming a cash discount of  210,n30,  ROG? The invoice had an April 8 date. Levin received the goods on April 19 and paid the invoice on April 25.



To find the delivered price (including freight) for the living room set, we'll break the problem down step-by-step:

### Step 1: Calculate the trade discount
Levin Furniture receives a 55% trade discount. The trade discount is calculated as:

\[
\text{Trade Discount} = \text{List Price} \times \frac{\text{Trade Discount Rate}}{100} = 4000 \times \frac{55}{100} = 4000 \times 0.55 = 2200
\]

So, the trade discount is $2,200.

### Step 2: Calculate the net price (after the trade discount)
The net price is the list price minus the trade discount:

\[
\text{Net Price} = \text{List Price} - \text{Trade Discount} = 4000 - 2200 = 1800
\]

### Step 3: Add the freight charges
The freight cost is $50, and since it is FOB shipping point, it is added to the net price. So, the total price before any cash discount is:

\[
\text{Total Price Before Cash Discount} = \text{Net Price} + \text{Freight} = 1800 + 50 = 1850
\]

### Step 4: Apply the cash discount
The cash discount is **2/10, n/30, ROG**, meaning Levin Furniture gets a 2% discount if it pays within 10 days of the receipt of goods, otherwise the full invoice amount is due in 30 days from the receipt of goods. 

- The goods were received on **April 19**, and the invoice was paid on **April 25**, which is within the 10-day discount period. Therefore, Levin Furniture is eligible for the 2% cash discount.

The cash discount is calculated on the net price **before** freight charges:

\[
\text{Cash Discount} = \text{Net Price} \times \frac{\text{Cash Discount Rate}}{100} = 1800 \times \frac{2}{100} = 1800 \times 0.02 = 36
\]

### Step 5: Calculate the final delivered price
The final delivered price is the total price (before the cash discount) minus the cash discount:

\[
\text{Final Delivered Price} = (\text{Total Price Before Cash Discount}) - (\text{Cash Discount}) = 1850 - 36 = 1814
\]

### Final Answer:
The delivered price, including freight and after applying the cash discount, is **$1,814**.

Would you like more details or have any questions?

Here are 5 related questions to deepen your understanding:
1. How would the delivered price change if the cash discount was not applied?
2. What is the significance of the FOB shipping point in this context?
3. How is the cash discount period affected by the ROG (receipt of goods) terms?
4. How does a trade discount affect the overall profitability for a retailer?
5. What would happen if Levin Furniture missed the cash discount period?

**Tip:** Always check the terms of sale (like ROG) closely to avoid missing out on discounts.

Levin Furniture buys a living room set with a $4,000 list price and a 55% trade discount. Freight (FOB shipping point) of $50 is not part of the list price. What is the delivered price (including freight) of the living room set, assuming a cash discount of 2/10, n/30, ROG? The invoice had an April 8 date. Levin received the goods on April 19 and paid the invoice on April 25.

Learn how to calculate the delivered price for Levin Furniture's purchase of a living room set with a $4,000 list price, 55% trade discount, and freight charges. This detailed solution explains how to apply trade and cash discounts using step-by-step formulas. Suitable for high school students studying trade and cash discounts.

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