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Dear Sir
I ve got a question about early settlement discount in payables.
In q4 June 11 ‘zps’ exam we have calculated the averages and then in the end cost for paying early and benefit of taking discount to see whats best.
However in q3 dec 13 ‘plot’ (which is pretty much same question to me as the zps) the answer is saying to deduct that 1% of discount straight away to calculate payable after the discount.
I just don’t understand why this is done differently.
Could you please explain.
Thank you
If you watch the free lecture, then I do say that there is an argument for both (for subtracting the discount, and for not subtracting the discount).
The examiners answers sometimes do it one way and sometime the other, but he always accepts either. (The difference is never actually very large.)
Ah ok great thank you very much.
I did watch all the lectures but it’s hard to remember everything whats in them 😉
But they are great and very helpful so thank you again 🙂
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