Fantasia Florist Shop purchases an order of imported roses with a list price of $2,375 less trade discounts of 15/20/20. What is the dollar amount of the trade discount?
To calculate the dollar amount of the trade discount, we need to follow these steps:
Step 1: Determine the list price of the imported roses.
The list price is given as $2,375.
Step 2: Calculate the first trade discount.
The first trade discount is 15%. To find this discount, multiply the list price by 0.15:
$2,375 * 0.15 = $356.25
Step 3: Calculate the second trade discount.
The second trade discount is 20%. To find this discount, subtract the first trade discount from the list price and multiply by 0.20:
($2,375 - $356.25) * 0.20 = $403.75
Step 4: Calculate the third trade discount.
The third trade discount is also 20%. To find this discount, subtract the sum of the first and second trade discounts from the list price and multiply by 0.20:
($2,375 - $356.25 - $403.75) * 0.20 = $482.25
Step 5: Calculate the total trade discount.
The total trade discount is the sum of the three individual trade discounts:
$356.25 + $403.75 + $482.25 = $1,242.25
Therefore, the dollar amount of the trade discount is $1,242.25.