Calculates the cost of not taking a cash discount.
disc% : The discount % if the payment is paid early.
t days : The total number of days until the bill must be paid.
d days : The number of days the discount is available.
You receive a bill with the credit terms 2/10, NET/30. What is the cost of not taking the cash discount?
|2||disc%||2.00||Stores the discount%.|
|10||d days||10.00||Stores the number of days the discount is available.|
|30||t days||30.00||Stores the total number of days until the bill must be paid.|
|cost%||36.73||Calculates the cost of not taking the discount as an annual percentage rate.|
Another way to calculate this is using the Simple Interest Loan - Days Calculator. Say you have the choice of $980 in 10 days or $1,000 in 30 days. So for a debt of 1000, loan of 980 (1000-2%) for 20 days that calculator gives i% as 37.24%. The difference can be attributed to using a 360 or 365 day year. (37.24*360/365=36.73) If you enter two dates 20 days apart (310, 330) on the Simple Interest Loan - NASD calculator, it will calculate 36.73 since it uses a 360 day year.
Reference: HP 10bii+ User Guide Additional Examples