Ace the ACCA Financial Accounting (F3) Exam 2025 – Unleash Your Accounting Superpowers!

To determine the discount Kyle would miss for not paying within the specified time frame, it is essential to understand how trade discounts are generally structured in financial transactions. Many businesses offer a cash discount to encourage early payment, which is often expressed as a percentage of the total invoice amount.

In this scenario, if Kyle does not pay within 10 days, he would miss out on a percentage discount applied to the $600 worth of goods. The most common discount for prompt payment is 3%, though sometimes other percentages like 5% may be offered for different terms, such as a longer payment window.

Assuming the business offers a 3% discount for payments made within 10 days, not taking advantage of this discount means Kyle misses the opportunity to reduce his payment amount by that percentage. Therefore, if the goods cost $600, a 3% discount translates to:

\[

3\% \text{ of } 600 = \frac{3}{100} \times 600 = 18

\]

So, by failing to pay within the discount period, Kyle would miss a discount of $18.

Understanding the specific terms of discounts offered on transactions is essential, as businesses may vary in their discount structures. While some may offer a