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When a sale is made in the credit terms of 2/10, net 30, what does the "10" refer to?

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Question added by Nafiha Nasar , HR & ADMINISTRATION , PROMAG
Date Posted: 2013/06/20
Tahir Mahmood
by Tahir Mahmood , Freelance Accountant , Mazdoo Accounting

credit days

Mohammed Munawer Ali Atif
by Mohammed Munawer Ali Atif , Vice President , Dawlance Group of Companies

credit days

It refers to the "Discount Period".
The term2/10, net30 allows a customer to deduct2% of the net amount owed if the customer pays within10 days of the invoice date.
If a customer does not pay within the discount period of10 days, the net purchase amount (without the discount) is due30 days after the invoice date.

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