Discount series

In this video, I discussed the definition of Discount Series and include working problems involving the tropic. Also, I presented how to solve the single equivalent discount after obtaining the discount amount.

1. Discount Series Discount series are also called Trade Discount Series or Chain Discount . Discount series happens when a LIST PRICE is subject to two or more discounts. Discount series can happen when manufacturers want to encourage buyers to order in large-volumes or place pre-ordered items.

2. An item listed at P1,500 is subject to a discount series of 20/10/5. How much is the NET PRICE of that item? 20%, 10%, and 5% List price 1,500 Less 20% of P1,500 (1,500 x .20) 300 Net price after 1 st discount 1,200 Less 10% of P1,200 (1,200 x .10) 120 Net price after 2 nd discount 1,080 Less 5% of P1,080 (1,080 x 0.05) 54 NET PRICE P1,026

3. An item listed at P1,500 is subject to a discount series of 20/10/5. How much is the NET PRICE of that item? 20%, 10%, and 5% Net Price Factor Approach Net Price = List Price x (1 – discount 1) x (1 – discount 2) x (1 – discount 3) = P1,500 x (1 – 0.20) x (1 – 0.10) x (1 – 0.05) = P1,500 x 0.80 x 0.90 x 0.95 Net Price = P1,026

4. An item listed at P1,500 is subject to a discount series of 20/10/5. How much is the NET PRICE of that item? 20%, 10%, and 5% Single Rate of Equivalent Discount The equivalent TOTAL discount applied to the LIST PRICE . Note: single rate of equivalent discount is NOT EQUAL to sum of ALL the discounts in the series. (20%, 10% and 5%)

5. An item listed at P1,500 is subject to a discount series of 20/10/5. How much is the NET PRICE of that item? 20%, 10%, and 5% Single Rate of Equivalent Discount Single Discount = 1 – [(1 – discount 1) x (1 – discount 2) x (1 – discount 3)] = 1 – [(1 – 0.20) x (1 – 0.10) x (1 – 0.05)] = 1 – (0.80 x 0.90 x 0.95) = 1 – 0.684 Single Discount = 0.316 or 31.6%

6. An item listed at P1,500 is subject to a discount series of 20/10/5. How much is the NET PRICE of that item? 20%, 10%, and 5% Single Rate of Equivalent Discount Amount of Discount = List Price – Net Price = P1,500 – P1,026 = P 474 Single Discount = = = 0.316 or 31.6%  

7. An item listed at P1,500 is subject to a discount series of 20/10/5. How much is the NET PRICE of that item? 20%, 10%, and 5% List Price P1,500 Amount of Discount P474 Net Price P1,026 Single Discount 31.6%

8. 2. A laptop listed at P25,000 subject to a series discount of 20/15/10/5. Determine the net price, amount of discount and the equivalent single discount of the laptop. List price 25,000 Less 20% of P25,000 (25,000 x .20) 5,000 Net price after 1 st discount 20,000 Less 15% of P20,000 (20,000 x .15) 3,000 Net price after 2 nd discount 17,000 Less 10% of P17,000 (17,000 x 0.10) 1,700 Net price after 3 rd discount 15,300 Less 5% of P15,300 (15,300 x 0.05) 765 NET PRICE P14,535

9. 2. A laptop listed at P25,000 subject to a series discount of 20/15/10/5. Determine the net price , amount of discount and the equivalent single discount of the laptop. Net Price Factor Approach Net Price = P25,000 x (1 – 0.20) x (1 – 0.15) x (1 – 0.10) x (1 – 0.05) = P25,000 x 0.80 x 0.85 x 0.90 x 0.95 = P25,000 x 0.5814 Net Price = P14,535

10. 2. A laptop listed at P25,000 subject to a series discount of 20/15/10/5. Determine the net price, amount of discount and the equivalent single discount of the laptop. Amount of Discount = List Price – Net Price = P25,000 – P14,535 = P10,465

11. 2. A laptop listed at P25,000 subject to a series discount of 20/15/10/5. Determine the net price, amount of discount and the equivalent single discount of the laptop. Equivalent Single Discount Single Discount = 1 - [(1 – 0.20) x (1 – 0.15) x (1 – 0.10) x (1 – 0.05)] = 1 – (0.80 x 0.85 x 0.90 x 0.95) = 1 – 0.5814 Single Discount = 0.4186 or 41.86%

12. 2. A laptop listed at P25,000 subject to a series discount of 20/15/10/5. Determine the net price, amount of discount and the equivalent single discount of the laptop. Equivalent Single Discount (Checking) Single Discount = = = 0.4186 or 41.86%  

13. 2. A laptop listed at P25,000 subject to a series discount of 20/15/10/5. Determine the net price, amount of discount and the equivalent single discount of the laptop. List Price P25,000 Amount of Discount P10,465 Net Price P14,535 Single Discount 41.86%

14. Summary Discount Series = more than one discount. Net Price Net Price Factor Approach NP = List Price x (1-d1) x (1-d2) x …..(1-dn) Single Discount = 1 – [(1-d1) x (1-d2) x ….(1-dn)] Single Discount checking SD = Amount of Discount / List Price