Which Statement Is True About Terms of Trade Credit of 2/10,net

question 101

Multiple Choice

Which statement is true about terms of trade credit of 2/10,net 30?

• A) A 10% cash discount is offered for payment before 30 days.
• B) A 2% cash discount can be taken for payment before the 10^th of the following month.
• C) A 10% cash discount can be taken if paid by the second day after invoicing.
• D) No cash discount is offered after the eleventh day.

---

Definitions:

Bondholders

Individuals or entities that hold debt securities issued by corporations or governments, entitling them to interest payments and the principal investment return at maturity.

Creditors

Individuals, businesses, or financial institutions that lend money or extend credit to others, expecting to be repaid with interest in the future.

Municipal Bonds

Debt securities issued by local governments or their agencies, often tax-exempt, to fund public projects and services.

Federal Income Tax

A tax levied by the U.S. federal government on the annual earnings of individuals, corporations, trusts, and other legal entities.