Discounts

Question 1

Discount

Answer 1

a percentage reduction in the selling price

Question 2

Bulk purchases

Answer 2

buying goods in large quantities

Question 3

Bulk discount

Answer 3

discount given for bulk purchases

Question 4

Prompt Payment Discount (PPD)

Answer 4

further % discount given when payment is made early

Question 5

Steps for a discount

Answer 5

1. calculate total price before
2. calculate trade discount
3. calculate net price before VAT
4. calculate VAT
5. calculate total invoice price

Question 6

Methods to reduce VAT and goods total when PPD is offered

Answer 6

1. the seller issues a credit note

2. the seller includes PPD declaration on the invoice