One manufacturer needs to calculate the net price of an order with a list price of $300 and a trade discount series of 12/9/5. Use the net decimal equivalent to find the net price.
To calculate the net price of an order with a list price and a trade discount series, follow these steps:
1. Determine the list price: In this case, the list price is given as $300.
2. Identify the trade discount series: The trade discount series is given as 12/9/5, which means there are three successive discounts: 12%, 9%, and 5%.
3. Calculate the net decimal equivalent: To calculate the net decimal equivalent, subtract each discount percentage from 100% (or 1 in decimal form) to get the net decimal equivalent for each discount. In this case, the net decimal equivalents would be as follows:
- First discount: 100% - 12% = 88% or 0.88 (in decimal form)
- Second discount: 100% - 9% = 91% or 0.91
- Third discount: 100% - 5% = 95% or 0.95
4. Multiply the net decimal equivalents: Multiply the net decimal equivalents together to get the overall net decimal equivalent. In this case, the calculation would be:
0.88 * 0.91 * 0.95 = 0.762204
5. Calculate the net price: To calculate the net price, multiply the list price by the overall net decimal equivalent. In this case, the calculation would be:
$300 * 0.762204 = $228.66
Therefore, the net price of the order with a list price of $300 and a trade discount series of 12/9/5 is $228.66.