CMA Study Group

  • 1.  Cash discount help

    Posted 10-11-2021 08:52 PM
    Can anyone help me understand why "C" is wrong?  Wouldn't the cash discount on a $1,000 purchase @ 2/10 net 30 be $100?  If so, the amount paid would be $900, correct?  I'm not understanding how the one I chose is wrong.   Thank you.

    Paula Catalano
    Franklin Park IL
    United States

  • 2.  RE: Cash discount help

    Posted 10-12-2021 10:25 AM
    Hi Paula,

    The discount is 1%10/Net 30 Days.  If paid within the 10 days the discount would be 1%, or $10.00, so the payment amount would be $990.00.

    Hope this helps/

  • 3.  RE: Cash discount help

    Posted 10-12-2021 11:30 AM
    Oh dear.  I was reading too fast and made a silly mistake. Thank you for the help.  I appreciate it.