A new business receives an invoice for merchandise on August 9. The terms of the sale are 12/10, n/30. If the manager elects to take the cash discount, what is the discount date?

Question

Jayce Juarez

Mathematics

26 December, 07:33

A new business receives an invoice for merchandise on August 9. The terms of the sale are 12/10, n/30. If the manager elects to take the cash discount, what is the discount date?

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Samantha Terrell · Answer 1

Indication "12/10, n/30" (or "12/10 net 30") on an account represents a cash (sales) discount provided by the seller to the buyer for swift payment.

The term 12/10, n/30 is a classic credit term and means the following:

"12" shows the discount percentage offered by the seller.

"10" indicates the number of days (from the invoice date) within which the buyer should pay the invoice in order to obtain the discount.

"n/30" states that if the buyer does not pay the (full) invoice amount within the 10 days to meet the requirements for the discount, then the net amount is due within 30 days after the sales invoice date.

The discount date begins at August 9 and the last day would be August 19.