Cash Discounts

is discount given to attract customer to pay earlier cash discount terms....

2/10,1/30,n/60

this term means 2% of net price maybe deducted if the invoice is paid within 10 days of the date of the invoice: 1% maybe deducted if paid between 11th and 30th day: and full amount must be paid by the both day.

ex: an invoice dated 11 March 2007 for RM 1100 was offered cash discount terms of 3/10,n/30.If the invoice was paid on 16 March 2007,what was the payment?

cash discount=3%(because the invoice was paid in 10 days)

Payment=RM 1100-(3% x 1100)

=RM 1067