Posted by Lisa on Wednesday, August 31, 2011 at 10:57pm.
I am trying to figure this out. I know I am not right. I was looking for some help on how to get the proper answer.
Morgan Company received from Lee Company an invoice dated September 27. Terms were 2/10 EOM. List price on the invoice was $5,000 (freight not included). Morgan receives a 9/7 chain discount. Freight charges are Morgan’s responsibility but Lee agreed to prepay the $150 freight charge. Morgan pays the invoice November 9. What does Morgan pay Lee?
Here is my answer:
So I know because he pays on the 9th he gets a 2% discount.
Which now brings the list price from $5,000 to $4,900
This is the part where I am confused 9/7 discount.So when I convert it to a percent it is 1.29%..Is this right.
So I think i take $4,900 - 1.29% so then ($63.21)<--So this would be the dollar amount I subtract from $4,900
I am not sure if I subtract or add $150.00.
Can anyone help me?
Math for business - Peggy, Sunday, February 19, 2012 at 5:50pm
Beginning price $5000. Terms are 2/10 End of Month. Paying on the 9th (before the 10th day of the month) triggers the 2% discount. $100 off.
New price $4900. Chain discounts apply. 4900 * 0.91 * 0.93 = $4146.87
Add in the $150 that Morgan agreed to repay for the shipping, the the final invoice price is $4316.87
Math for business - Cine, Tuesday, September 25, 2012 at 9:19pm
Invoice dated september 27 Morgan pay invoice November 9 therefore the 2% discount expired.
5000x.09=450. 5000-450=4550. 4550x.07=318.50 4550-3180.50=4231.50+ 150=4381.20
Math for business - Hina, Sunday, February 28, 2016 at 12:53pm
2/10 Discount (considering Morgan payed before the 10 day period)
Discount: $5,000 * 2/10 = $100 (deducted)
= Net Price: $4,900
Chain Discount (9/7)
= $4900 * .09 = $441 --> $4900-$441= $4459 --> $4459 * .07 = $312.13 --> $4459- $312.13 = $4146.87
Add Freight Charge of $150
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