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Can someone help please

What is the
Net, Vat and total if Settlement discount is 2.5% and Trade discount is 15%.

Items total is 466.62.


Comments

  • ariadneariadne Registered Posts: 218
    Gina, I presume this items total is the goods at list price total. It's a while since I did this, but this is how I understood it.

    You take off the trade discount first and this is the price charged for the items on the invoice.

    £466.62 - 15% = charge without VAT (net)

    You then work out the total minus the settlement discount and use this total to calculate the VAT.

    £net -2.5% = amount charged if settlement discount is taken but this is not listed on the invoice.

    Divide by 5 to get 20% which is the VAT charge

    Add VAT to net = total

    The VAT remains the same even if the settlement discount isn't taken up. The total for the items without VAT doesn't include the settlement discount but this is deducted later in ledgers if it is taken up when the invoice is paid.
  • GinaNGinaN Registered Posts: 6
    Thank you for your help
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