Discounts and credit terms, Finance Basics

Discounts and Credit Terms

Credit Terms

Credit terms involve both the length of the credit time and the discount specified.  The terms 2/10, n/30 means that a 2 percent discount is specified if the bill is paid before the tenth day after the date of invoice or else the total amount should be paid by the 30th day.

In assuming the credit terms to offer the firm should look at the profitability caused via longer credit and discount period or a higher rate of discount against rise cost.

Discounts

Varying the discount includes an attempt to speed up the payment of obtainable.  It can conclusion also in reduced bad debt losses.

Posted Date: 1/31/2013 8:17:55 AM | Location : United States







Related Discussions:- Discounts and credit terms, Assignment Help, Ask Question on Discounts and credit terms, Get Answer, Expert's Help, Discounts and credit terms Discussions

Write discussion on Discounts and credit terms
Your posts are moderated
Related Questions
What is cash deficit?And what is cash surplus?Describe each of them in detail.

What is the one-year Treasury security rate of 1R1? For 1R3=11%, E(2r1)= 4% and E(3r1)=5%

Stewardship Accounting Shareholders contribute capital that is provided to the directors that they employ and at the end of each accounting year render an explanation on the a

Liquidity Preference Theory This theory states that short term bonds are extremely favorable than long term bonds for two (2) purposes. 1. Investors usually prefer short te

A compnay can arrange for a secured loan amounting to 150,000,000 for one year at an interest rate of 18% per annum based on the initial balance of the loan. The lender also imposs

Constant amount per share or fixed D.P.S. 1. The DPS is fixed in total amount of irrespective of the earnings level. These generate certainty and are consequently preferred vi

Application of Discriminant Analysis Application of Discriminant Analysis to the Selection of Applicants, Discriminative analysis is a statistical model such can be used to ac

Accounts Payable Turnover Ratio Ratio for Account Payable Turnover is as Follow: Creditors/accounts payable turnover = Annual credit purchases /Average creditors

Investment Analysis Any type of company will invest finance for the sake of deriving a return that is useful for four main purposes as: 1. To reward the owners or shareholder

Development of Plastic Money in Middle Asia Motive behind the Fast Development of This Finance (Plastic Money) In Middle Asia a) High incidences of fraud via dishonest empl