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The purpose of this is to shorten accounts receivable cycles for those who provide credit terms.This is essential when vendors have accounts receivable turnover cycles which exist longer than preferred. 7– 2 PERFORMANCE OBJECTIVES Section I The Invoice 7-1: Reading and understanding the parts of an invoice 7-2: Extending and totaling an invoice Section II Trade Discounts—Single 7-3: Calculating the amount of a single trade discount 7-4: Calculating net price by using the net price factor, complement method 7-5: Calculating trade discount rate when list price and net price are known© 2009 Cengage Learning. 7– 3 PERFORMANCE OBJECTIVES (cont’d) Section III Trade Discounts—Series 7-6: Calculating net price and the amount of a trade discount by using a series of trade discounts 7-7: Calculating the net price of a series of trade discounts by using the net price factor, complement method 7-8: Calculating the amount of a trade discount by using a single equivalent discount Section IV Cash Discounts and Terms of Sale 7-9: Calculating cash discounts and net amount due 7-10: Calculating net amount due, with credit given for partial payment 7-11: Determining discount date and net date by using various dating methods© 2009 Cengage Learning. 7– 4 The Invoice invoice A document detailing a sales transaction, containing a list of goods shipped or services rendered, with an account of all costs. Net price = List price × Net price factor Net price factor = 100 — 46 = 54% Alternate Method: Net price = 2,800 ( 100% – 46%) = 2,800 ( .54) = 1,512 Net price = 2,800 × .54 = 1,1512© 2009 Cengage Learning. 7– 15 Trade Discount Rate Example A watch has a list price of 9 and can be bought by the jewelry store for a net price of 5.75.

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Then, when you enter a voucher or invoice for that customer or supplier, you can either accept the default value or override it with a different payment term.Businesses love to offer 2/10 net 30 for 2 reasons: it makes customers happy while speeding up cash cycles.Variations on this method include 2/10 net 40, 2/10 net 45, 2/10 net 60, 2/10 n 30 EOM (end of month), and more.I am trying to translate the following sentence into Romanian "Invoices are due 30 days end of month invoice date".This sounds like poor English to me, and I have trouble understanding what the sentence as a whole means.




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