Get-Down Electronics buys MP3 players with an invoice date of June 29 and terms of sale of 4/20 EOM. Calculate the discount date.

Question

Quizplus · Accepted Answer

The terms "4/20 EOM" mean a 4% discount is available if payment is made within 20 days after the end of the month of the invoice date. The invoice date is June 29, so the end of the month is June 30. Adding 20 days to June 30 gives a discount date of July 20. However, since the question asks for the discount date, the correct choice is August 20, as the discount period extends to the next month.

Get-Down Electronics Buys MP3 Players with an Invoice Date of June