DISCOUNTS

B Y G I E A N N E M A R I E R . I N O T, L P T
OBJECTIVES

1. Differentiate the types of discounts

2. Illustrate how to compute single trade
discounts, discount series and cash
discount
3. Solve problems involving discounts
DEFINITION OF TERMS
• List Price – the suggested price of an item set by the manufacturer (MSRP)
• Discount – a reduction from the selling price of a good or service
• Net Price – the resulting price after the discount is applied to the list price
• Trade Discount – an amount deducted from the list price of an item,
usually given by manufacturers to retailers to
enable them to earn bigger profit
• Cash Discount – an amount deducted on the net price to persuade
customers to pay in cash immediately or within a time
period
• Discount Series – refers to multiple trade discounts
– has an equivalent single rate of discount
A car manufacturer is promoting its new LIST PRICE

car model suggesting a retail price of TRADE

DISCOUNT
Php 3 700 000, but offers this at 15%
less to the first 50 retailers to purchase DISCOUNT
SERIES
and another 20% discount if they have
purchased at least 50 cars. Howard, a NET PRICE

car retailer, sells the car according to the

CASH
MSRP and offers it at 10% off if the DISCOUNT

customer pays on cash within 15 days.

1. FIND THE TRADE DISCOUNT AND THE
NET PRICE OF A SHIRT LISTED AT PHP 925,
AND THE RETAILER IS GRANTED A 20%
TRADE DISCOUNT RATE.
1. FIND THE TRADE DISCOUNT AND THE
NET PRICE OF A SHIRT LISTED AT PHP 925,
AND THE RETAILER IS GRANTED A 20%
TRADE DISCOUNT RATE.
2. A RETAILER HAD A TRADE
DISCOUNT OF PHP 991.20 AND PAID
ONLY PHP 2 548.80 FOR A CERTAIN
GOOD. WHAT IS THE LIST PRICE AND
THE RATE OF DISCOUNT?
2. A RETAILER HAD A TRADE
DISCOUNT OF PHP 991.20 AND PAID
ONLY PHP 2 548.80 FOR A CERTAIN
GOOD. WHAT IS THE LIST PRICE AND
THE RATE OF DISCOUNT?
3. TWO SUPPLIERS OFFER IDENTICAL DINING
SETS AT THE SAME LIST PRICE. HOWEVER,
COMPANY A GIVES TRADE DISCOUNT SERIES OF
15%, 10% AND ANOTHER 10%, WHILE COMPANY B
OFFERS 20%, 10% AND 5%. WHICH IS A BETTER
DISCOUNT FOR THE BUYER?
4. A SCIENTIFIC CALCULATOR WORTH
PHP 1 495 IS SUBJECT TO 10% AND 5%
TRADE DISCOUNTS. FIND THE SINGLE
RATE EQUIVALENT TO THE DISCOUNTS,
TRADE DISCOUNT AND THE NET PRICE.
4. A SCIENTIFIC CALCULATOR WORTH
PHP 1 495 IS SUBJECT TO 10% AND 5%
TRADE DISCOUNTS. FIND THE SINGLE
RATE EQUIVALENT TO THE DISCOUNTS,
TRADE DISCOUNT AND THE NET PRICE .
4. A SCIENTIFIC CALCULATOR WORTH
PHP 1 495 IS SUBJECT TO 10% AND 5%
TRADE DISCOUNTS. FIND THE SINGLE
RATE EQUIVALENT TO THE DISCOUNTS,
TRADE DISCOUNT AND THE NET PRICE.
5. A BOOKSTORE OFFERS A 10% DISCOUNT
TO RETAILERS. IF A MATH BOOK PRICED AT
PHP 695 WAS SOLD AT PHP 600, COMPUTE
THE ADDITIONAL TRADE DISCOUNT GIVEN
BY THE SHOP.
6. GIVEN THE FOLLOWING, DETERMINE THE
CASH DISCOUNT USING 3 DATING METHOD

Date of Invoice : 19 June 2019

Date of Goods Delivered : 06 July 2019
Date of Goods Received : 08 July 2019
Date of Payment : 21 July 2019
Given Terms : 5/15, 2/30, n/60
Invoice Amount : Php 31 529

STARTING DATE ENDING DATE OF ENDING DATE OF

DATING AMOUNT OF
OF DISCOUNT THE 1ST DISCOUNT THE 2ND DISCOUNT
METHOD DISCOUNT
PERIOD PERIOD PERIOD

Apply the rate of

Ordinary (or 1st term after 2nd term after
Date of Invoice discount according
Invoice Date) starting date starting date to the given terms
6. GIVEN THE FOLLOWING, DETERMINE THE
CASH DISCOUNT USING 3 DATING METHOD

Date of Invoice : 19 June 2019

Date of Goods Delivered : 06 July 2019
Date of Goods Received : 08 July 2019
Date of Payment : 21 July 2019
Given Terms : 5/15, 2/30, n/60
Invoice Amount : Php 31 529

STARTING DATE ENDING DATE OF ENDING DATE OF

DATING AMOUNT OF
OF DISCOUNT THE 1ST DISCOUNT THE 2ND DISCOUNT
METHOD DISCOUNT
PERIOD PERIOD PERIOD

Ordinary (or
Invoice Date)
6. GIVEN THE FOLLOWING, DETERMINE THE
CASH DISCOUNT USING 3 DATING METHOD

Date of Invoice : 19 June 2019

Date of Goods Delivered : 06 July 2019
Date of Goods Received : 08 July 2019
Date of Payment : 21 July 2019
Given Terms : 5/15, 2/30, n/60
Invoice Amount : Php 31 529

STARTING DATE ENDING DATE OF ENDING DATE OF

DATING AMOUNT OF
OF DISCOUNT THE 1ST DISCOUNT THE 2ND DISCOUNT
METHOD DISCOUNT
PERIOD PERIOD PERIOD

Apply the rate of

End of the Last day of the 1st term after 2nd term after
discount according
Month month of Invoice starting date starting date to the given terms
6. GIVEN THE FOLLOWING, DETERMINE THE
CASH DISCOUNT USING 3 DATING METHOD

Date of Invoice : 19 June 2019

Date of Goods Delivered : 06 July 2019
Date of Goods Received : 08 July 2019
Date of Payment : 21 July 2019
Given Terms : 5/15, 2/30, n/60
Invoice Amount : Php 31 529

STARTING DATE ENDING DATE OF ENDING DATE OF

DATING AMOUNT OF
OF DISCOUNT THE 1ST DISCOUNT THE 2ND DISCOUNT
METHOD DISCOUNT
PERIOD PERIOD PERIOD

End of the
Month
6. GIVEN THE FOLLOWING, DETERMINE THE
CASH DISCOUNT USING 3 DATING METHOD

Date of Invoice : 19 June 2019

Date of Goods Delivered : 06 July 2019
Date of Goods Received : 08 July 2019
Date of Payment : 21 July 2019
Given Terms : 5/15, 2/30, n/60
Invoice Amount : Php 31 529

STARTING DATE ENDING DATE OF ENDING DATE OF

DATING AMOUNT OF
OF DISCOUNT THE 1ST DISCOUNT THE 2ND DISCOUNT
METHOD DISCOUNT
PERIOD PERIOD PERIOD

Apply the rate of

Receipt of Date of goods 1st term after 2nd term after
discount according
Goods received starting date starting date to the given terms
6. GIVEN THE FOLLOWING, DETERMINE THE
CASH DISCOUNT USING 3 DATING METHOD

Date of Invoice : 19 June 2019

Date of Goods Delivered : 06 July 2019
Date of Goods Received : 08 July 2019
Date of Payment : 21 July 2019
Given Terms : 5/15, 2/30, n/60
Invoice Amount : Php 31 529

STARTING DATE ENDING DATE OF ENDING DATE OF

DATING AMOUNT OF
OF DISCOUNT THE 1ST DISCOUNT THE 2ND DISCOUNT
METHOD DISCOUNT
PERIOD PERIOD PERIOD

Receipt of
Goods
BE READY FOR
AN ONLINE
ACTIVITY
ABOUT THE
TOPIC
DISCOUNTS