When deciding whether or not to take a trade discount,the cost of borrowing from a bank or other source should be compared to the cost of trade credit to determine if the cash discount should be taken.

Question

Quizplus · Accepted Answer

This statement is true. It is important to compare the cost of borrowing from a bank or other source to the cost of trade credit (in this case, the amount of the discount) to determine if it is more cost-effective to take the discount or to pay the full amount at a later date.

When Deciding Whether or Not to Take a Trade Discount,the