Problema Solution
Melissa, of Melissa's Lawn and Landscaping Service, needs to replace her leaf blowers. She has ordered five new gas trimmers, at $55.97 each, She has negotiated Trade Discount Rate of 3%, and terms of 2/10, EOM, FOB Shipping Point. The invoice is dated May 10, does not include the shipping charge. The manufacturer has agreed to pre-pay the shipping charge of $30
What is the payment amount assuming that Melissa pays before the end of the discount period?
Answer provided by our tutors
Applying trade discount and payment done before the end of the discount period
Payment with discount = 5*55.97(1-0.03)(1 - 0.02) = $266.02541
Applying freight (FOB shipping point):
Payment with freight = $266.02541 + $30 = $296.02541