# Sample 1 - Task 4

HH_
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**3**Registered
Hi,

Is anyone able to explain the answer for Period 5 using option 1 and 2. The answer shows option1: 542000 and option 2: 553500.

Many thanks in advance.

Is anyone able to explain the answer for Period 5 using option 1 and 2. The answer shows option1: 542000 and option 2: 553500.

Many thanks in advance.

## Comments

3Registered4RegisteredPeriod 5:

Option 1 - 10% discount

So the 42,000 x £10 x 0.90 =378,000 (All paid in Period 5)

Period 4: As the new discount starts from Period 4 onwards this is all paid in Period 4

The remaining balance of 40% from Period 3 paid in Period 5 = 164,000

164,000 + 378,000 = 542,000

Option 2: 5% discount 50% paid in month of purchase

Period 5 payments

Period 3 - still original timing of receipts = 40% 164,000 balance paid Period 5

Period 4 - 50% at discounted paid in Period 5 (40,000 x £10 x 0.95) = 380,000

50% Period 4 paid in Period 5 = 190,000

Period 5 sales = 42,000 x £10 x 0.95 = 399,000

50% paid in period 5 = 199,500

Period 5 total payments = 164,000 + 190,000 + 199,500 = 553,500

Hope I have explained this okay!

2RegisteredI am sitting exam this Friday for second time, and i do understand slightly your explanation above, however sometimes it is like head against the wall.

Could you please explain more detailed?

44Registered2Registered