1. What payment should be made on the invoice from the previous question if it is paid on September 3?
2. If the manufacturer from the question above charges a 4½% late fee, how much would City Cellular owe if it did not pay the balance by the net date?
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To determine the payment to be made on the invoice if it is paid on September 3, we need to calculate the number of days between the invoice date and September 3, and then apply the appropriate discount or interest rate.
1. Calculate the number of days from the invoice date to September 3:
- Determine the invoice date from the previous question.
- Subtract the invoice date from September 3 to get the number of days.
For example, if the invoice date is August 29:
- Subtract August 29 from September 3: 3 - 29 = 5 days.
2. Apply the appropriate discount or interest rate:
- Check the terms of the invoice to see if any early payment discounts or late fees apply.
To determine how much City Cellular would owe if it did not pay the balance by the net date and if a 4½% late fee is charged by the manufacturer, follow the steps below:
1. Identify the net date from the previous question.
2. Calculate the number of days from the net date until the date of payment.
3. Multiply the balance on the invoice by the late fee rate (4½% or 0.045) to calculate the late fee amount.
4. Add the late fee amount to the balance on the invoice to determine the total amount owed.
For example, if the net date is September 5 and the balance on the invoice is $500:
- Subtract September 5 from the date of payment to calculate the number of days late.
- Multiply the balance on the invoice ($500) by the late fee rate (0.045) to calculate the late fee amount.
- Add the late fee amount to the balance on the invoice to determine the total amount owed.