Gce Model Questions Vol1 2017 Commerce Question 12
Practice objective / multiple choice question 12 from the 2017 Gce Model Questions Vol1 Commerce examination.
A supplier issues an invoice of ₦250,000 with terms "2 % discount if paid within 10 days, net 30". The supplier also offers a 1 % early‑payment discount if the invoice is settled within 20 days; the two discounts cannot be combined. The buyer pays on day 25, so the 2 % discount is missed but the 1 % discount is taken. The supplier charges interest of 0.5 % per month on the outstanding amount for the period after the 10‑day discount window. Calculate (a) the total amount the buyer pays on day 25, and (b) the effective annualised cost of forgoing the 2 % discount in favour of the 1 % discount, assuming a 365‑day year.
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About This Question
This is Gce Model Questions Vol1 2017 Commerce Question 12. It is one of the objective questions from the 2017 Gce Model Questions Vol1 Commerce examination.
Difficulty level: Hard .
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