In general, most businesses should take advantage of a cash discount of 2/10 net 30 because the cost of not doing so is more expensive than the cost of borrowing.

Question

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By taking advantage of a cash discount of 2/10 net 30, businesses can save money on their accounts payable. The cost of not taking this discount is effectively like borrowing money from the vendor at a high interest rate. Therefore, it is generally more cost-effective to take the discount than to pay the full amount later.

In General, Most Businesses Should Take Advantage of a Cash