What is Cash Discount?

What is Cash Discount?
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What is Cash Discount?
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What was the biggest savings you ever got on the "cash payment no receipt required" discount?

Description : What was the biggest savings you ever got on the "cash payment no receipt required" discount?

Last Answer : Good luck suing without a receipt. I have no objecting to dealing on the grey or black market, and do so whenever I can get away with it. But on high-ticket trades work, there are simply too many ... a certified union journeyman (and chances are sie wouldn't do a cash deal), I wouldn't risk it.

Cash Discount What ?

Last Answer : The rest Sold out Product Price Specific Of time In Realization To do For Creditors His Total Debts From That Amount Money Debtor Who Discount Gives Him Cash Discount Says.

Trade discount is calculated after cash discount while calculating discount on purchase or sales.

Description : Trade discount is calculated after cash discount while calculating discount on purchase or sales.

Last Answer : Correct the following statement and rewrite the statement : Trade discount is calculated after ... while calculating discount on purchase or sales.

A cash discount is an incentive allowed for the speedy recovery of income.

Description : A cash discount is an incentive allowed for the speedy recovery of income.

Last Answer : State whether the following statement are true or false with reason : A cash discount is an incentive allowed for the speedy recovery of income.

If he Central Bank wants to encourage an increase in the supply of money and decrease in the cost of borrowing money, it should - (1) lower cash reserve ratio (2) raise discount rates (3) sell government securities (4) All of the above

Description : If he Central Bank wants to encourage an increase in the supply of money and decrease in the cost of borrowing money, it should - (1) lower cash reserve ratio (2) raise discount rates (3) sell government securities (4) All of the above

Last Answer : (1) lower cash reserve ratio Explanation: When the Central Bank of a country intends to increase money supply, it should lower the Cash Reserve Ratio. A decrease in CRR helps the commercial banks to ... the amount of Bank deposits and they will lend more as they have more amount as their reserve.

Which of the following is true? A. Discounted cash flow analysis is the least precise of the cash flow techniques, because it does not consider the time value of money. B. NPV is the least precise of the cash flow analysis techniques, because it assumes reinvestment at the discount rate. C. Payback period is the least precise of the cash flow analysis techniques, because it does not consider the time value of money. D. IRR is the least precise of the cash flow analysis techniques, because it assumes reinvestment at the cost of capital.

Description : Which of the following is true?  A. Discounted cash flow analysis is the least precise of the cash flow techniques, because  it does not consider the time value of money. B. NPV is ... least precise of the cash flow analysis techniques, because it assumes  reinvestment at the cost of capital.

Last Answer : C. Payback period is the least precise of the cash flow analysis techniques, because it  does not consider the time value of money.

Which of the following statements is incorrect regarding a normal project? A. If the NPV of a project is greater than 0, then its PI will exceed 1. B. If the IRR of a project is 8%, its NPV, using a discount rate, k, greater than 8%, will be less than 0.C. If the PI of a project equals 0, then the project's initial cash outflow equals the PV of its cash flows. D. If the IRR of a project is greater than the discount rate, k, then its PI will be greater than 1.

Description : Which of the following statements is incorrect regarding a normal project? A. If the NPV of a project is greater than 0, then its PI will exceed 1. B. If the IRR of a project is 8%, its NPV, using ... the IRR of a project is greater than the discount rate, k, then its PI will be greater than 1.

Last Answer : D. If the IRR of a project is greater than the discount rate, k, then its PI will be greater than 1.

The collection of a $900 account after the 2 percent discount period will result in a a. debit to Cash for $882. b. debit to Accounts Receivable for $900. c. debit to Cash for $900. d. debit to Sales Discounts for $18.

Description : The collection of a $900 account after the 2 percent discount period will result in a a. debit to Cash for $882. b. debit to Accounts Receivable for $900. c. debit to Cash for $900. d. debit to Sales Discounts for $18.

Last Answer : c. debit to Cash for $900.

The collection of a $600 account within the 2 percent discount period will result in a a. debit to Sales Discounts for $12. b. debit to Accounts Receivable for $588. c. credit to Cash for $588. d. credit to Accounts Receivable for $588.

Description : The collection of a $600 account within the 2 percent discount period will result in a a. debit to Sales Discounts for $12. b. debit to Accounts Receivable for $588. c. credit to Cash for $588. d. credit to Accounts Receivable for $588.

Last Answer : a. debit to Sales Discounts for $12.

The entry to record the receipt of payment within the discount period on a sale of $750 with terms of 2/10, n/30 will include a credit to a. Sales Discounts for $15. b. Cash for $735. c. Accounts Receivable for $750. d. Sales for $750.

Description : The entry to record the receipt of payment within the discount period on a sale of $750 with terms of 2/10, n/30 will include a credit to a. Sales Discounts for $15. b. Cash for $735. c. Accounts Receivable for $750. d. Sales for $750.

Last Answer : c. Accounts Receivable for $750.

If a company is given credit terms of 2/10, n/30, it should a. hold off paying the bill until the end of the credit period, while investing the money at 10% annual interest during this time. b. pay within the discount period and recognize a savings. c. pay within the credit period but don't take the trouble to invest the cash while waiting to pay the bill. d. recognize that the supplier is desperate for cash and withhold payment until the end of the credit period while negotiating a lower sales price.

Description : If a company is given credit terms of 2/10, n/30, it should a. hold off paying the bill until the end of the credit period, while investing the money at 10% annual interest during ... desperate for cash and withhold payment until the end of the credit period while negotiating a lower sales price.

Last Answer : b. pay within the discount period and recognize a savings.

A company has to choose between two projects whose cash flows are as indicated below; Project 1: i. Investment – Rs. 15 Lakhs ii. Annual cost savings – Rs. 4 lakhs. iii. Bi-annual maintenance cost – Rs. 50,000/- iv. Reconditioning and overhaul during 5th year: 6 lakhs v. Life of the project – 8 years vi. Salvage value – Rs. 5 lakhs Project 2: vii. Investment – Rs. 14 Lakhs viii. Annual cost savings – Rs. 3.5 lakhs. ix. Annual Maintenance cost – Rs. 20,000/- x. Reconditioning and overhaul during 4th year: 5 lakhs xi. Life of the project – 8 years xii. Salvage Value- 2 lakhs Which project should the company choose? The annual discount rate is 12

Description :  A company has to choose between two projects whose cash flows are as indicated  below; Project 1:  i. Investment - Rs. 15 Lakhs ii. Annual cost savings - Rs. 4 lakhs. iii. Bi-annual ... years xii. Salvage Value- 2 lakhs Which project should the company choose? The annual discount rate is 12

Last Answer : Year Project 1 Project 2 Outgo Saving NPV Outgo Saving NPV 0 15.0 0 =-15.0 14.0 0 = -14 1 0 4.0 = (4 / (1+.12)1 = 3.571 0.2 3.5 = (3.3 / (1+.12)1 = 2.95 2 0.5 4.0 = (3.5 / (1+.12)2 = 2.79 0.2 3.5 ... (1+.12)8 = 3.43 0.2 5.5  (3.5+2) = (5.3 / (1+.12)8 = 2.14 NPV = + 2.301 @12% = + 0.15

What adjustment is made while using the Discounted Cash Flow method to value cyclical companies? a) Normalize earnings b) Use high discount rate c) Use bank rate for discounting d) Use high growth rate

Description : What adjustment is made while using the Discounted Cash Flow method to value cyclical companies? a) Normalize earnings b) Use high discount rate c) Use bank rate for discounting d) Use high growth rate

Last Answer : a) Normalize earnings

Cash discount allowed to a debtor should be credited to a) Discount account b)Customer’s account c) Sales account d) Cash account

Description : Cash discount allowed to a debtor should be credited to a) Discount account b)Customer’s account c) Sales account d) Cash account

Last Answer : b)Customer’s account

If Ralph Lauren offers to give retailers half the costs they incur in advertising Polo after -shave, the retailers have the option of taking advantage of a(n): A)seasonal discount. B)allowance. C)trade discount. D)noncumulative refund. E)cash discount.

Description : If Ralph Lauren offers to give retailers half the costs they incur in advertising Polo after-shave, the retailers have the option of taking advantage of a(n): A)seasonal discount. B)allowance. C)trade discount. D)noncumulative refund. E)cash discount.

Last Answer : B)allowance.

If Tailormaid offers to reduce the price of its women's blazers when retailers buy over one hundred pieces, the manufacturer is offering a __________ discount. A)quantity B)cash C)seasonal D)trade

Description : If Tailormaid offers to reduce the price of its women's blazers when retailers buy over one hundred pieces, the manufacturer is offering a __________ discount. A)quantity B)cash C)seasonal D)trade

Last Answer : A)quantity

If Nordica offered a 25 percent discount to retailers that ordered ski boots in February for delivery in May, the retailer would have the option of taking advantage of which type of discount? A)Trade B)Cumulative C)Cash D)Quantity E)Seasonal

Description : If Nordica offered a 25 percent discount to retailers that ordered ski boots in February for delivery in May, the retailer would have the option of taking advantage of which type of discount? A)Trade B)Cumulative C)Cash D)Quantity E)Seasonal

Last Answer : E)Seasonal

The buyer at Exeter Furniture Store is informed that if she will increase her recent order of fifteen mattress sets to twenty, she will receive a 14 percent price reduction. This offer is due to a recent overstock condition at the factory and will not be available in the future. The discount offered here is A)cash. B)noncumulative. C)seasonal. D)trade. E)cumulative.

Description : The buyer at Exeter Furniture Store is informed that if she will increase her recent order of fifteen mattress sets to twenty, she will receive a 14 percent price reduction. This offer is due to a ... future. The discount offered here is A)cash. B)noncumulative. C)seasonal. D)trade. E)cumulative.

Last Answer : B)noncumulative.

What type of discount is given to a purchaser for performing activities such as transporting, storing, and selling? A)Quantity discount B)Cash discount C)Geographic discount D)Service discount E)Trade discount

Description : What type of discount is given to a purchaser for performing activities such as transporting, storing, and selling? A)Quantity discount B)Cash discount C)Geographic discount D)Service discount E)Trade discount

Last Answer : E)Trade discount

If the Central Bank wants to encourage an increase in the supply of money and decrease in the cost of borrowing money, it should (1) lower cash reserve ratio (2) raise discount rates (3) sell government securities (4) All of the above

Description : If the Central Bank wants to encourage an increase in the supply of money and decrease in the cost of borrowing money, it should (1) lower cash reserve ratio (2) raise discount rates (3) sell government securities (4) All of the above

Last Answer :  lower cash reserve ratio