Question 2: Conditions for cash discount: Pay within 1 days of sales and enjoy 2% cash discount; Pay within 11-2 days of sales and enjoy 1% cash discount; Pay in full within 21-3 days of sales (n is the abbreviation of "none", which means "nothing at all")
Question 3: Cash discount condition: 2/1; 1/2; What does N/3 mean? Jargon: That is to say,
1. If you can pay within 1 days, there will be a 2% discount, so the discount for 1 items is: 1 * 5 * 2%
2. If the other party pays within 2 days, you can enjoy a 1% cash discount! That is, the discount you give is: 1 * 5 * 1%
3. If you pay within 2 -3 days, you won't be able to enjoy the cash discount
4. You must pay within 3 days, and if you pay outside 3 days, you will be fined!
The following article is for reference:
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Accounts payable is an account owed to the other party because the enterprise has not paid for the goods, that is, the seller allows the buyer to pay for the goods within a certain period after purchase. For the seller, this method can be used to promote sales, but for the buyer, it is equivalent to borrowing money from the seller to buy goods to meet the buyer's short-term capital needs.
corresponding to accounts receivable, accounts payable also have credit conditions such as payment period and discount. Accounts payable can be divided into: free credit, that is, the credit obtained by the buyer's enterprise during the specified discount period; Valuable credit, that is, the credit obtained by the buyer's enterprise to give up the discount and pay the price; Extended credit, that is, the credit obtained by the buyer's enterprise after delaying payment beyond the prescribed credit period. When using credit conditions, enterprises should calculate the cost of the credit to obtain the maximum benefit.
giving up the cost of cash discount
if the buyer pays within the discount period specified by the seller after purchasing the goods, it can enjoy free credit. In this case, the enterprise has not paid the price for enjoying the credit.
For example, an enterprise can enjoy a cash discount of 2% if it pays within 1 days according to 2/1 or N/3 (; After 1 days, pay within 3 days, without cash discount) to buy goods of 1, yuan. If the enterprise pays within 1 days, it will enjoy a free credit period of 1 days, and get a discount of RMB 2, (1× 2%), with a free credit of RMB 98, (1-.2).
if the buyer gives up the discount and pays after 1 days (not more than 3 days), the enterprise will bear the implied interest cost caused by giving up the discount. Generally speaking, the cost of giving up cash discount can be obtained by the following formula:
Cost of giving up cash discount = discount percentage/(1-discount percentage) × 36/(credit period-discount period)
Using the above formula, the cost borne by the enterprise to give up discount = 2%/(1-2%) × 36/(3-1. It can be seen that if the buyer gives up the discount and gets credit, the price is relatively high. However, if the enterprise gives up the discount, the longer it delays payment, the smaller its cost will be. For example, if the enterprise delays the payment to 5 days, its cost = 2%/(1-2%) × 36/(5-1) = 18.4%
Decision to use cash discount
Under the condition of attaching credit conditions, the buyer's enterprise has to make a decision on which credit to use because it costs different money to obtain different credits. Generally speaking:
If you can borrow money at an interest rate lower than the implied interest cost (in essence, an opportunity cost) of giving up the cash discount, you should use the borrowed money to pay for the goods during the cash discount period and enjoy the cash discount. For example, if the annual interest rate of short-term bank loans in the same period as the above example is 12%, the buyer's enterprise should use cheaper bank loans to repay the accounts payable during the discount period, otherwise, the enterprise should give up the discount.
if the accounts payable are used for short-term investment during the discount period, and the investment yield is higher than the implied interest cost of giving up the discount, you should give up the discount and pursue higher returns. Of course, if the enterprise gives up the discount, it should also postpone the payment date to the last day of the credit period to reduce the cost of giving up the discount.
if the enterprise wants to extend the payment period due to lack of funds, it needs to choose between the reduced cost of giving up the discount and the loss caused by extending the payment. The loss caused by deferred payment mainly refers to the loss of credit of suppliers and even other lenders due to the deterioration of corporate reputation, or the harsh credit conditions in the future.
if faced with two or more sellers offering different credit terms, we should choose the one with the lowest credit cost (or the biggest benefit) by measuring the discount cost. For example, there is another one in the above example > >
Question 4: What do you mean by a cash discount of 2/1? Generally speaking, if customers pay within 1 days, they can pay 2% less.
question 5: what does the cash discount mean? Hello, classmate, I'm glad to answer your questions!
cash discount, also known as sales discount. A price concession provided to urge customers to pay the payment as soon as possible. The cash discount is expressed as follows: 2/1, 1/2, n/3 (that is, if the payment is made within 1 days, the payment will be discounted by 2%; Payment within 2 days, 1% discount, full payment within 3 days). Cash discount occurs after sales, which is a financing financial expense, so sales discount cannot be deducted from sales.
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question 6: the significance of commercial discount and cash discount. commercial discount: (it has nothing to do with accounting treatment) accounting records are only recorded according to the net amount of commodity pricing after deducting commercial discount. Cash discount: (related to accounting treatment) is a preferential price given to encourage customers to pay in advance. Differences: 1. Commercial discount occurs immediately and cash discount occurs when paying; 2. Different purposes: commercial discount is for promotion, and cash discount is for customers to pay in advance. Cash discount requires mastering the total price method. The total price method is that when the sales business occurs, the accounts receivable and sales revenue take the actual selling price before deducting the cash discount as the entry value, and the actual cash discount as the financial expense.
question 7: what does the cash discount mean? Lowering the base price is usually used to encourage early payment or promotion.
question 8: what does the cash discount mean? Hello, classmate, I'm glad to answer your questions!
cash discount is to lower the base price, which is usually used to encourage early payment or promotion.
CMA qualification examination in the second half of 215 is coming soon. Here, I wish you all a good exam, and everyone will perform well and achieve good results!
I hope my answer can help you solve the problem. If you are satisfied, please adopt it as the best answer.
Thank you again for your question. More accounting questions are welcome to be submitted to Gao Dun enterprises.
Gao Dun wishes you a happy life!
Question 9: What do you mean by the cash discount terms of 2/1-1/2-N/3? The more detailed the better. You can enjoy a 2% cash discount if you pay within 1 days, that is to say, the payment quota is accounts payable multiplied by (1-98%), the same below
1/2, 1-2 days.