Eom or end of month dating
In accounting, a cash (sales) discount represents an expense to the seller. In other words, the $1,000 amount can be settled for $980 if it is paid within the 10-day discount period.
It is a method of billing, which allows for cash discount and the full payment period to begin on the first day of the following month instead of on the invoice date.End-of-month invoices dated after the 25th of the month are considered to be dated on the first of the following month.are the payment rules imposed by suppliers on their customers.Payment terms are imposed to ensure that payments are received by suppliers within a reasonable period of time.The earlier the store makes payment on the goods, the greater the discount. These discounts are noted as "X1/Y1/X2/Y2/X3/Y3/..." where: End-of-Month Dating End-of-Month dating indicates that a percentage deduction from the invoice cost before shipping is available beginning the last day of the month for which the invoice is dated.
The terms offered by the seller usually depend on the trade custom.
Some variations of the cash discount terms, among others, may be "2/15, n/30" (2% discount for the payment within 15 days and the full amount to be paid within 30 days) or "n/10 EOM" (the invoice is due and payable 10 days after the end of the month in which the sale occurred). within 10 days of the invoice date, the customer is allowed to deduct $20 (2% of $1,000) from the purchase of $1,000.
It is common for vendors to offer discounts to encourage prompt payment.
When deciding whether to take a payment discount, consider your availability of cash and if the merchandise is in and received.
Cash Discounts Cash discounts are a percentage deduction from the invoice cost before shipping.
They are noted as "X/Y/net Z" where: Variable Discounts To encourage early payment for goods, vendors sometimes offer a sliding scale of discounts called "variable discounts." Variable discounts are calculated as a percentage that is deducted from the invoice cost before shipping.