Problema Solution
A man received an invoice for a leaf blower for $464 dated April 18
with sales terms of 3/10 EOM. How much should he pay if he pays the bill on April
30?
Answer provided by our tutors
3/10 EOM - this means the buyer will receive a cash discount of 3% if the bill is paid within 10 days after the end of the month indicated on the invoice date.
If an invoice is received on or before the 25th day of the month, payment is due on the 10th day of the next calendar month.
If a proper invoice is received after the 25th day of the month, payment is due on the 10th day of the second calendar month.
The invoice is received on April 18 thus payment is due on 10 of May. This means the buyer will receive cash discount of 3% and the amount due is:
464 - 0.03*464= 0.97*464 = $450.08
$450.08 is due.