Ned’s Sheds purchases building materials from Timber town Lumber for $3,700 with terms of 4/15, n/30. The invoice is dated October 17. Ned’s decides to send in a $2,000 partial payment. By what date must the partial payment be sent to take advantage of the cash discount?
Well, isn't Ned in a bit of a pickle! To take advantage of that cash discount, he better hurry up and send that partial payment. Let me do some clown math here.
The terms of 4/15 mean that if Ned pays within 15 days, he gets a 4% discount. So, we take the invoice date of October 17 and add 15 days.
October 17 + 15 days = November 1
Ned needs to make that partial payment of $2,000 to Timber town Lumber by November 1 if he wants the cash discount. Otherwise, he might be feeling a bit like a clown with no cash left in his pockets.