Which One of the Following Statements Is Correct If You

question 271

Multiple Choice

Which one of the following statements is correct if you purchase an item with credit terms of 2/5, net 15?

• A) If you pay within two days, you will receive a 5 percent discount.
• B) If you pay within 2 to 5 days, you will receive a 15 percent discount.
• C) If you do not pay within 5 days, you will be charged interest at a 15 percent annual rate.
• D) If you pay within 5 days, you will receive a 2 percent discount.
• E) You must pay the discounted amount within 15 days.

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Definitions:

Cash Payments

Transactions where the payment of goods or services is made with currency or banknotes rather than by check or electronic means.

Government Securities

Debt instruments issued by a government to raise funds from the public.