An invoice of $12,000 is dated April 5. The terms 5/10,n/30 are offered. Find the amount due if the discount is earned. Show your work.
what's 5% of 12000? 600.
To find the amount due if the discount is earned, we need to understand the terms mentioned.
The terms 5/10, n/30 indicate that a discount of 5% is offered if the payment is made within 10 days. Otherwise, the full amount is due within 30 days.
First, let's calculate the discount amount:
Discount = Invoice Amount x Discount Rate
Discount = $12,000 x 5%
Discount = $12,000 x 0.05
Discount = $600
Now, we need to determine whether the discount can be earned by paying within 10 days. To do that, we subtract the discount period (5 days) from the discount period limit (10 days):
Discount Period Limit - Discount Period = n
10 days - 5 days = 5 days
Since the discount period limit minus the discount period is equal to "n", which is 5 days, we know that the full payment must be made within these 5 days to earn the discount.
Therefore, if the payment is made within 5 days:
Amount Due = Invoice Amount - Discount
Amount Due = $12,000 - $600
Amount Due = $11,400
Hence, if the discount is earned, the amount due would be $11,400.