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wausau1
Nov 30, 2011, 12:20 PM
I am doing a problem and part of the problem says Kinzer Furniture paid $2,000 of May 4 invoice less the discount. What do they mean by less the discount?

kcomissiong
Nov 30, 2011, 12:35 PM
You would look at the terms on the account to figure out the discount. It is a reduction on the invoice total if the invoice is paid in X number is days. You will see terms like 1% 10 net 30 Days. It means that the invoice is due in 30 days, and there is a discount (or deduction) of 1% offered if the discount is paid in 10 days.

wausau1
Nov 30, 2011, 12:47 PM
So in the problem it say 2/15 n/30 so I would take 2% off the $2,000?

kcomissiong
Nov 30, 2011, 12:57 PM
Yes ma'am.

wausau1
Nov 30, 2011, 01:10 PM
Thanks.