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Chapter 7 Vocab
Mathematics of Buying
| Term | Definition |
|---|---|
| ea. | each |
| doz. | dozen |
| gro. | gross (144 items) |
| gr gro. | great gross (12 gross) |
| qt. | quart |
| gal. | gallon (4 quarts) |
| bbl. | barrel |
| cL | centiliter |
| L | liter |
| in. | inch |
| ft. | foot |
| yd. | yard |
| mm | millimeter |
| cm | centimeter |
| m | meter |
| km | kilometer |
| ct. | crate |
| drm. | drum |
| cs. | case |
| pr. | pair |
| C | Roman numeral for 100 |
| M | Roman numeral for 1000 |
| cwt. | per hundred weight |
| cpm. | cost per thousand |
| lb. | pound |
| oz. | ounce |
| g | gram |
| kg | kilogram |
| ROG | receipt of goods |
| ex. or x | extra dating |
| FOB | free on board |
| EOM | end of month |
| COD | cash on delivery |
| FAS | free alongside ship |
| Free on board (FOB) shipping point | Buyer pays for shipping costs. Ownership of goods passes to the purchaser prior to the shipment |
| FOB destination | Seller pays the shipping charge and retains ownership until goods reach the destination |
| Cash on delivery (COD) | Payment for goods is made at the time of delivery |
| Free alongside ship (FAS) | Goods are delivered to the dock with all freight charges to that point paid by the seller |
| Net Cost | List price ‒ Trade discount |
| series or chain discount | a combination of two or more discounts |
| What does 20/10 mean? | a series discount of 20% followed by an additional discount of 10% |
| complement of a discount | difference of 1 and the discount i.e. 1 ‒ Discount |
| Net cost equivalent | product of complements of discounts |
| Net Cost After Discount | List Price * Net Cost Equivalent |
| Discount Amount | Original Price ‒ Net Cost after discount |
| Single Discount Equivalent | Compliment of the Net cost equivalent (100% ‒ Net Cost Equivalent %) |
| What does 10/30/20 mean? | a series/chain discount of 10% followed by an additional discount of 30% which is then followed by a third discount of 20% |
| Net Cost | (List Price ‒ Trade Discount) ‒ Cash Discount |
| Give an example of Ordinary Dating Method | 2/10, n/30 or 2/10, net 30 |
| What does 2/10, n/30 mean? | a 2% discount applies if invoice is paid within 10 days; full invoice must be paid within 30 days |
| Total Amount Due | Amount Due + Shipping & Insurance |
| Amount Due | Invoice Amount ‒ Cash Discount |
| An invoice is dated Oct 21 AS OF Nov 1 from which of these 2 dates are the terms calculated? | terms are calculated using the AS OF date Nov 1 |
| prox | proximo (same as EOM end-of-month) |
| What does 3/10 EOM mean? | a 3% discount applies if invoice is paid by the 10th of the month that follows the sale NOTE: IF INVOICE DATE IS THE 26TH OR LATER, ADD AN EXTRA MONTH |
| What does 3/10 prox. mean? | a 3% discount applies if invoice is paid by the 10th of the month that follows the sale NOTE: IF INVOICE DATE IS THE 26TH OR LATER, ADD AN EXTRA MONTH |
| What does 2/10 ROG mean? | a 2% discount applies if invoice is paid within 10 days of receiving goods |
| What is the common business practice if no net payment due date is given? | If no net payment due date is given/listed on an invoice, it is common business practice to allow 20 days after the last discount date as the net payment date |
| What does 2/10-50 ex. mean? | the 2% discount typically offered if invoice is paid within 10 days will be extended for an extra 50 days. i.e. a 2% discount applies if invoice is paid within 60 days (10 days standard + 50 days extra) |
| What does 3/10-30 x. mean? | the 3% discount typically offered if invoice is paid within 10 days will be extended for an extra 30 days. i.e. a 3% discount applies if invoice is paid within 40 days (10 days standard + 30 days extra) |
| Balance Due | Invoice Amount ‒ Credit Given |
| Cash Discount Earned | Credit Given ‒ Partial Payment |
Created by:
rizekm
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