Page 18 Chapter 2
P. 18
CHAPTER 2
Selling Goods and Services
2.3
T&T sells tiles. This month there is a special offer. If you buy 20 boxes or more a discount of
30% is offered.
The most popular line in tiles is normally offered at £35.00 per box
The following credit customers buy this popular line during the month:
a) D Barton buys 50 boxes
b) E Woodward buys 15 boxes
c) Goodwin Tiles Ltd buys 1000 boxes.
Calculate in each case:
1. The total cost before discount and VAT
2. The discount
3. The cost after discount
4. The VAT charged (current rate 20%)
5. The total cost
2.4
T&T offers a 2% prompt payment discount if invoices are paid within 10 days. Calculate the
amounts due in task 2.3 if the prompt payment discount is accepted in each case.
2.5
In the above cases how much would each credit note show to allow for the discount taken?
2.6
F Blake bought some of these tiles before the special offer began. However, he was offered
a 3% prompt payment discount when he ordered them. T&T allows a credit note to all
customers who return unopened boxes. F Blake is now returning 10 boxes for a refund.
Calculate:
a) The total amount of the refund before VAT
b) The VAT amount refunded
c) The total amount shown on the Credit Note
‐ 28 -
