Settlement discount

jonesey10

Hi Y'all.
Is there a way you can work out settlement discount from just a statement?
i.e gross figure is £2555.90 for an invoice and the settlement discount was 3%
I know the answer is £65.55 but i'm buggered if I know how to get there.

Thanks

Cullen

Presuming the VAT is still at 17.5%:

2555.9 divide by 117.5 times 3 = 65.25

Cullen

Aaaargh, maybe I am not quite as brilliant as I thought as I am out by 30p.

jonesey10

Cullen wrote: »

Presuming the VAT is still at 17.5%:

2555.9 divide by 117.5 times 3 = 65.25

But that's not the answer, the answer is 65.55.
The settlement discount was taken off the net of the invoice then the VAT added. the original net amount for the invoice was £2185.00 less 3% SD
The original figures are as follows:
Net: £2185.00
17.5% VAT = £370.90
Invoice total = £2555.90
Settlement discount £65.55

But if all you've got is the gross figure on the statement and the fact that 3% SD can be taken, how can you work out what the original SD figure was?
It's beginning to eat away at me now.

Cullen

OK, I think I have it now,

2555.9 = 100x + (97x(17.5x/100))

Therefore:

2555.9 = 100x + 16.97x

Thus:

2555.9 = 116.97x

And:

2555.9/116.97 = x

Then:

3x = 3 x 2555.9/116.97 = 65.55


( Fingers crossed)

Cullen

Putting that into english:

£2555.90 equals all the net, (100x) plus the vat on 97%, 97x (17.5x/100)

The rest is just a little bit of old skool algebra

Does this look ok to you? Where's my Sensei?

jonesey10

Wow, I thought it may have been straightforward, I'm sure your right, I'll have a go.
Thanks so much for helping.

crispy

Hello,

Another way of working this out on caluculator: -

17.5 x 0.97 = 16.975

2555.90/116.975 x 16.975 = £ 370.90 (VAT)

2555.90 - 370.90 = £ 2,185.00 (Net)


Hope this helps