Calculate discount: gross or net amount
Cash discount is a percentage discount on the sales price.
- Therefore, it doesnt matter whether you do the calculation based on gross or net.
- This is intended to clarify the following example : Assuming the invoice amount is 100 euros net, the sales tax is 19 percent and the cash discount is 2 percent.
- Calculate the discount based on the net amount, there remains a remainder of: €100 * 0.98 (98%) = €98. If you calculate this amount from the gross, you get: €98 * 1.19 (119%) = €116.62
- The same result is provided by the calculation based on the gross amount . First, calculate the gross invoice amount: €100 * 1.19 (119%) = €119. If you deduct the discount now, you will also receive €116.62 (€119 * 0.98).
- You can calculate the discount from both gross and net.
Discount: All information at a glance
Taking advantage of discounts can save you money.
- Cash discount is a subsequent price reduction.
- It is granted if the customer pays within a certain time.
- The discount rate is usually between 2 and 5 percent.
- Cash discount is attractive for both parties.
- The customer can get a discount by using it.
- And the seller creates an incentive to pay quickly.
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