Book a Tutor Become a Tutor Math Learning Centre Learning Strategies Learning Circles, Review Sessions & Open Tutoring9Tutoring Guidelines Practice and Review English Language Help Contact the Learning Centre Trade Discount Trade discount is applied on the List price. The value of trade discount depends on the rate of discount.
The price after any trade discount is known as the Net price.
This allows the company a few weeks to pay for the goods. In this case, the invoice is due within 30 days after receiving it, but 30 days doesn't always fall on the end of a month.
In FBZP, the 'Max Cash Discount' option is not checked and there are no tolerances defined in the Paying Co Code config either.
Payment Terms are 'Invoice is due at end of month but 2% discount can be taken if paid within 15 days'.
For example, an invoice that is marked 2/10, n/30 EOM lists a cash discount, net payment terms, and a specific payment date. If the invoice is paid within the first ten days after receiving it, the seller will discount the order by 2 percent.
This ten day window is often called the discount period.
A 2 percent discount is quite advantageous for most businesses.