MKT 305 Chapter 17.3: MKT 305 Chapter 17.: MKT Chapter 17.3 Textbook Notes
Document Summary
Apply to purchases over a given period and the discount usually increases as the amount purchased increases. Encourage repeat buying by reducing the customer"s cost for additional purchases. Does not tie a buyer to the seller after the single purchase. Offered to encourage buyers to buy earlier than present demand requires. "most sales to businesses are made on credit. The seller sends a bill (invoice) by mail or electronically, and the buyer"s accounting department processes it for payment. Some firms depend on their suppliers for temporary working capital (credit). Therefore, it is very important for both sides to clearly state the terms of payment including the availability of cash discounts and to understand the commonly used payment terms" Payment for the face value of the invoice is due immediately. Sometimes changed to net 10 or net 30. Payment is due within 10 or 30 days of the date on the invoice.
