Problema Solution
A watch has a list price of $889 and can be bought by Sterling Jewelers for a net price of $545.75.
a. What is the amount of the trade discount?
$
b. What is the trade discount rate?
Do not enter the percent symbol in your answer.
%
Answer provided by our tutors
a.
Net Price = List Price - Trade Discount
Trade Discount = List Price - Net Price
Trade Discount = $889 - $545.75
Trade Discount = $343.25
b.
Trade Discount = List Price * Trade Discount Rate
Trade Discount Rate = Trade Discount/List Price
Trade Discount Rate = $343.25$/889
Trade Discount Rate = 0.3861 or 38.61%