Thread: Retail Math problem involving quantity discount. Have answer need to know the work!

ok. I don't understand the wording of the problem I guess. I know the answer, it's at the back of my textbook, just not how to get it. A friend in my same major, who took the class last year can't figure it out either. Maybe we're both having an off day.

Problem: As an incentive, a supplier offers an additional 10% quantity discount on orders of more than 5 bikes. The normal trade discount offered by the supplier is 40%, 10% on the suggested list price of $250 each. how much would a retailer remit if 8 bikes are purchased?

The answer is $972.

What I tried:
8 bikes x $250 ea. = $2,000 list price

Step 2. Find the billed cost:

$2,000 total list price x 40% trade discount = $800 trade discount
$2,000 list price - $800 trade discount = $1200 billed cost


That's where I get stuck. If I take the 10% quantity discount from the $1200... that comes to $1080. But the answer supposed to be $972. Am I even doing the right thing by taking a 40% trade discount off? The wording is so weird to me.

Thanks.

this is my solution...
8 bikes = RM 250 x 8

Originally Posted by tots

ok. I don't understand the wording of the problem I guess. I know the answer, it's at the back of my textbook, just not how to get it. A friend in my same major, who took the class last year can't figure it out either. Maybe we're both having an off day.

Problem: As an incentive, a supplier offers an additional 10% quantity discount on orders of more than 5 bikes. The normal trade discount offered by the supplier is 40%, 10% on the suggested list price of $250 each. how much would a retailer remit if 8 bikes are purchased?

The answer is $972.

What I tried:
8 bikes x $250 ea. = $2,000 list price

Step 2. Find the billed cost:

$2,000 total list price x 40% trade discount = $800 trade discount
$2,000 list price - $800 trade discount = $1200 billed cost


That's where I get stuck. If I take the 10% quantity discount from the $1200... that comes to $1080. But the answer supposed to be $972. Am I even doing the right thing by taking a 40% trade discount off? The wording is so weird to me.

Thanks.

mm this is my solution:

8 bikes = $250 x 8
= $2000

Trade discount :
$2000 x 40% = $800
$2000 - $800 = $1200

then have 10% trade discount on suggestion list price:
$1200 x 10% = $120
$1200 - $120 = $1080

the incentive buy more than 5 bikes, so have additional 10% quantity discount :
$1080 x 10% = $108
$1080 - $108 = $ 972

this is my solution..i don't know wheter u agree or not...
anyway..thnx for the question..
i'm doing revision of business math for my final exam..

Originally Posted by tots

ok. I don't understand the wording of the problem I guess. I know the answer, it's at the back of my textbook, just not how to get it. A friend in my same major, who took the class last year can't figure it out either. Maybe we're both having an off day.

Problem: As an incentive, a supplier offers an additional 10% quantity discount on orders of more than 5 bikes. The normal trade discount offered by the supplier is 40%, 10% on the suggested list price of $250 each. how much would a retailer remit if 8 bikes are purchased?

The answer is $972.

What I tried:
8 bikes x $250 ea. = $2,000 list price

Step 2. Find the billed cost:

$2,000 total list price x 40% trade discount = $800 trade discount
$2,000 list price - $800 trade discount = $1200 billed cost


That's where I get stuck. If I take the 10% quantity discount from the $1200... that comes to $1080. But the answer supposed to be $972. Am I even doing the right thing by taking a 40% trade discount off? The wording is so weird to me.

Thanks.