Question

goods purchased from M/s neel kamal at a list price of rs 12000 at 10% trade discount and 3% cash discount . cash was paid upto 80% of the amount

Answer 1

List price (given) = 12000
Trade Discount = 12000*10%
= 1200
Since, trade discount is computed on list price only.
Sale value = 12000 - 1200
= 10800
Cash Discount = 10800*80%*3%
= 8640*3%
=259.20
Since, Cash discount is always computed on the actual cash paid. Because cash discount is given to encourage early payment.
Whereas trade discount is given to encourage sales.
Cash received = 8640 - 259.2
= 8380.80

Answer 2

In this question, we are asked to tell how much cash is paid.

The cash received is 8380.80.

GIVEN: Price of the goods = 12,000; 10% trade discount. 3% cash discount; cash paid is 80%

TO FIND: Cach paid

SOLUTION:

List price (given) = 12000

Trade Discount = 12000×10%

= 1200

Since trade discount is computed on list price only.

Sale value = 12000 - 1200

                = 10800

Cash Discount = 10800×80%×3%

= 8640×3%

=259.20

Since Cash discount is always computed on the actual cash paid. Because cash discount is given to encourage early payment.

Whereas trade discount is given to encourage sales.

Cash received = 8640 - 259.2

                        = 8380.80

The cash received is 8380.80.

PROJECT CODE #SPJ2