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    PercyB's Avatar
    PercyB Posts: 1, Reputation: 1
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    #1

    Mar 2, 2012, 11:00 AM
    How to calculate total discount over time?
    I sell a three year service contract at $1,000 per year. I want the customer to pay for the three years upfront. The "cost of money" in that country is 10% per annum. What is the total amount that I should deduct from the $3,000 upfront payment?
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
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    #2

    Mar 2, 2012, 11:04 AM
    What is $1,000 per year * 10% discount* 3 years? Your answer is $300 so you can deduct $300 from the total amount due, which will be $2,700 upfront cost.

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