Under terms of sale 2/5, net 30, how much discount will a buyer receive on a $60,000 bill paid on the net due date?

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Prepare for the AAMI Small Business Management Test with flashcards and multiple choice questions; each question comes with hints and explanations. Get exam ready!

Multiple Choice

Under terms of sale 2/5, net 30, how much discount will a buyer receive on a $60,000 bill paid on the net due date?

Explanation:
Two-five terms give a 2% discount if you pay within 5 days; the net 30 part means the full amount is due in 30 days if you don’t take that early payment option. Paying on the net due date falls outside the 5-day discount window, so no discount is earned. On a $60,000 bill, the discount would be 0, and the amount due at that time is the full $60,000. If payment had been made within the first five days, the discount would be 2% of $60,000, which is $1,200, reducing the payment to $58,800.

Two-five terms give a 2% discount if you pay within 5 days; the net 30 part means the full amount is due in 30 days if you don’t take that early payment option. Paying on the net due date falls outside the 5-day discount window, so no discount is earned. On a $60,000 bill, the discount would be 0, and the amount due at that time is the full $60,000. If payment had been made within the first five days, the discount would be 2% of $60,000, which is $1,200, reducing the payment to $58,800.

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