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Let's work through the problem step by step. Here's the information provided in the question:

- Garden Company purchased merchandise from Parker Company for **$90,000** on terms **1/15, net 45**.
- Garden Company returned **$16,000** of merchandise.
- Garden received full credit for the returned merchandise.
- If Garden pays within the discount period, what is the amount of cash required?

### Step-by-step solution:

1. **Start with the original purchase amount:**
   - Purchase: **$90,000**.

2. **Subtract the returned merchandise:**
   - Merchandise returned: **$16,000**.
   - Net purchase = $ 90,000 - 16,000 = 74,000 $.

3. **Apply the discount if payment is within the discount period:**
   - Discount terms: **1/15** means a 1% discount if payment is made within 15 days.
   - Calculate the 1% discount on the net amount:  
     \[
     \text{Discount} = 74,000 \times 0.01 = 740
     \]
   - Subtract the discount from the net purchase:  
     \[
     \text{Cash required} = 74,000 - 740 = 73,260
     \]

Thus, the amount of cash required for payment is **$73,260**, which corresponds to option **d.**

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Would you like more details on any step? Here are 5 related questions to deepen your understanding:

1. What does the term "1/15, net 45" mean in an invoice?
2. How would the payment amount change if Garden Company did not pay within the discount period?
3. How are returns of merchandise typically accounted for in financial statements?
4. Can you calculate the discount for other percentages, such as 2% or 3%?
5. What are the financial benefits of paying within the discount period?

**Tip:** Always double-check if a return is credited before calculating any discounts on payments.

Garden Company purchased merchandise on account from Parker Company for $90,000 with terms 1/15, net 45. Garden Company returned $16,000 of the merchandise and received full credit from Parker Company. If Garden Company pays within the discount period, what is the amount of cash required for payment?

Learn how to calculate the cash payment required for Garden Company after merchandise returns and applying a 1% discount for early payment. Original purchase: $90,000, returns: $16,000, and discount applied for payment within 15 days.

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