Compare and discuss a discount period versus a credit period
What will be an ideal response?
Answer: A credit period is the length of time allowed for payment of goods sold on account. Customers are encouraged to pay their bills within this time frame to maintain a good credit rating.
A discount period is shorter than the credit period to encourage early payment of bills. Customers are given an incentive to make payments shortly after invoicing.
Terms such as 1/10, n/30 demonstrates the discount period and the credit period. The discount period is 10 days and the credit period is 30 days. If the customer pays the bill within 10 days, the customer will receive a 1% discount, or the balance is due in full if the customer pays the bill within 30 days.
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Which of the following statements is true regarding the Japanese style of decision making?
A) short-term selling cycle B) lack of relationship building C) involving more consensus D) direct negotiating style
Benita incurred a business expense on December 10, 2016, which she charged on her bank credit card. She paid the credit card statement which included the charge on January 5, 2017 . Which of the following is correct?
a. If Benita is a cash method taxpayer, she cannot deduct the expense until 2017. b. If Benita is an accrual method taxpayer, she can deduct the expense in 2016. c. If Benita uses the accrual method, she can choose to deduct the expense in either 2016 or 2017. d. Only b. and c. are correct. e. a., b., and c. are correct.