Cash Discount Calculator
A supplier offers 2/10 net 30 — should you pay early? Enter the invoice amount, discount, and payment terms to compare the early-payment saving against its effective yearly rate, then decide with your cash position in mind.
Result
Enter values to see the result.
How to use
- Fill in the fields above with your own figures — results update live as you type.
- Terms like 2/10 net 30 mean 2 percent off if paid in 10 days, otherwise full amount in 30 days. The effective yearly rate annualizes that saving.
- Check the result box and adjust any rate or parameter to test other cases.
Note: Also weigh your cash position — an early payment is only good if the business can spare the cash.
Frequently Asked Questions (FAQ)
What does the cash discount calculator compare?
It works out whether taking an early payment discount beats paying on the full due date.
What does 2/10 net 30 mean?
It means 2 percent off if you pay within 10 days, otherwise the full amount is due in 30 days.
What is the effective yearly rate shown?
It annualizes the saving from the discount so you can compare it with other rates.
When is paying early NOT a good idea?
When the business cannot spare the cash. An early payment only makes sense if your cash position stays healthy after paying.