Allowance

The most common types of discounts and allowances are listed below.

[edit] discount rates and allowances dealing with requital[edit] Prompt defrayment discount Trade Discount:Deduction in equipment casualty given by the wholesaler/manufacturer to the retailer at the list price or catalogue price. Cash Discount:Reduction in price given by the creditor to the debitor is cognize as cash discount. This discount is int demolitioned to speed pay and thereby provide liquidity to the firm. They are sometimes utilize as a promotional device.

[edit] Examples2/10 net 30 - this way the buyer must pay within 30 age of the invoice date, but will receive a 2% discount if they pay within 10 solar geezerhood of the invoice date.
3/7 EOM - this means the buyer will receive a cash discount of 3% if the pen nib is paid within 7 years after the end of the month indicated on the invoice date. If an invoice is have on or before the twenty-fifth day of the month, payment is imputable on the 7th day of the next schedule month. If a proper invoice is received after the 25th day of the month, payment is due on the 7th day of the here and now calendar month.
3/7 EOM net 30 - this means the buyer must pay within 30 days of the invoice date, but will receive a 3% discount if they pay within 7 days after the end of the month indicated on the invoice date.



If an invoice is received on or before the 25th day of the month, payment is due on the 7th day of the next calendar month. If a proper invoice is received after the 25th day of the month, payment is due on the 7th day of the second calendar month.
2/15 net 40 ROG - this means the buyer must pay within 40 days of receipt of goods, but will receive a 2% discount if paid in 15 days of the invoice date. (ROG is short for Receipt of goods.)
[edit] Preferred payment method discount Some retailers (particularly small retailers with low margins) offer discounts to customers compensable with cash, to avoid paying fees on credit card transactions.

[edit] overtone payment discount Similar to the Trade...If you want to get a full essay, order it on our website: Orderessay



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