If an item is purchased with terms of 2/EOM, n/60, there is a discount for paying within 60 days

is it true or false

False.

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To calculate the terms of 2/EOM, n/60, and determine the discount for paying within 60 days, you need to understand the meaning of the terms and the calculations involved.

1. 2/EOM: This term stands for "2% discount if paid within the end of the month." It means that if payment is made by the end of the month following the invoice date, a 2% discount can be applied. For example, if an invoice is dated January 15th, the payment due date with the discount would be February 28th.

2. n/60: This term indicates that the full payment should be made within 60 days of the invoice date, without any discount. So, for an invoice dated January 15th, the payment due date without the discount would be March 15th.

To determine the discount for paying within 60 days, you can follow these steps:

Step 1: Identify the invoice date. Let's assume the invoice date is January 15th.

Step 2: Calculate the discount due date. Since the terms are 2/EOM, n/60, the discount due date would be the end of the month following the invoice date. In this case, the discount due date is February 28th.

Step 3: Calculate the payment due date without the discount. As per the terms n/60, the payment due date without any discount would be 60 days after the invoice date. Therefore, the payment due date without a discount is March 15th.

Step 4: Calculate the number of days between the discount due date and the unlimited payment due date. In this case, the discount due date is February 28th, and the unlimited payment due date is March 15th. The difference is 15 days.

Step 5: Determine the discount amount. The discount is 2% of the total invoice amount. If the total invoice amount is $1000, the discount would be $1000 * 2% = $20.

So, in this given example, if you pay within 60 days, you don't get any discount. However, if you pay by the end of the month following the invoice date, you can apply a 2% discount ($20 in this case).