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Pipe Supply Company Offers Its Customers Trade Credit Terms of 2/10

Question 17

Multiple Choice

Pipe Supply Company offers its customers trade credit terms of 2/10 net 30. What does this mean?


A) Customers have 2 days to pay 10 percent of their bill, and then, they have 30 days to pay the rest.
B) Customers can save 2 percent off the invoice amount if they pay within 10 days, or they can pay the entire amount within 30 days.
C) Customers can save 30 percent off their invoice amount if they pay 10 percent of the bill within 2 days.
D) Customers can save $2 for every $10 they spend if they pay within 30 days.
E) Customers can save 10 percent off the invoice amount if they pay within 2 days, or they can pay the entire amount within 30 days.

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