They can also pay before 30 days. These opportunities to reduce costs often also mean you can build your credit faster since early invoice. As a result, net 15 offers greater cash flow flexibility for businesses. Invoice date: October 1. A Net 30 payment term means the buyer has to make payment in full within 30 days of the invoice date. The seller offers no prompt payment discount. But if the amount due is not paid within 10 days, the customer needs to pay the full amount of the invoice. A form of trade credit, net 30 accounts allow customers to pay up to 30 days after the invoice date. 1} Solution: Step 1: Initialize the value of n n = number of elements present in the set. So. that all right if a [smiling man on the phone] 01:40. If you pay within 10 days, you receive a 1% discount. 1/10 net 30, 2/10 net 30, and 3/10 net 30 are the three most common incentives attached to net 30 payment terms. What does 2% 10 days net 30 days mean? For example, the payment term 2% 10 Days/Net 30 Days indicates that payment must be received within 30 days, and there is a 2% discount if it is received within 10. b. Seller alternatives to using net 90 credit terms may be payable in advance (PIA) or COD (cash or collect on delivery), short-term net 7, net 10, net 15, net 30, 1/10 net 30, 2/10 net 30, net 45, or net 60. So Net 30 means that the buyer will pay the seller in full on or before the 30th calendar day, including weekends and public holidays. NET platform. Seller alternatives to using net 90 credit terms may be payable in advance (PIA) or COD (cash or collect on delivery), short-term net 7, net 10, net 15, net 30, 1/10 net 30, 2/10 net 30, net 45, or net 60. Notably, some terms even offer incentives for early payment, such as the 2/10 Net 30, rewarding faster payers with. Net 30 payment terms can help to retain existing clients. For example, if the terms are Net 15, then the customer must pay within 15 days. You may find that clients prefer longer. Otherwise, the total amount is due within 30 days. If payment is not made within 30 days, the customer may. 10 in net profit. O. Two-tenths of a percent discount for payment within 30 days. Learn more. What Does Net-net Mean For Your Portfolio? Net-net investing is a strategy of investing in net net stocks that performs very well for small investors for a few reasons. This invoice agreement is usually written like 2/10, n/30 or 2/10, net/30. 1%/10 Net 30 is a type of payment term that is often used in business transactions. So, if the payment term is net 30 EOM, it means that the customer has 30 days to pay back, after the end of the month when the invoice was sent. Best Answer. That’s a 36% return on cash for the discount. Most small business owners will have heard of Net 30 payment terms. This serves to encourage clients to pay more over a shorter period of time. What does "2/10" mean, with respect to "credit terms of 2/10, n/30"? A. What does net 30 mean on an invoice? This is a variation of Net 30 that offers a discount for early payment. Invoices contain the date of sale, goods or services purchased, payment terms and conditions, etc. The number after net represents the number of days to pay an invoice in full. Net 60—you guessed it—signifies payment is due 60 days after the invoice date. Modify and enter necessary dates and discount percentages. But if it is not paid with in 10 days, the customer will pay pay the amount due in full within 30 days. ) Cancel Which simply means if the buyer pays the invoice within 10 days, they will receive a 2% discount. In this case, the number “2” represents the percentage of discount offered, while “10” signifies the number of days within which the payment must be made to. Technically, the seller is lending the buyer money. Meaning of 30. For example, if you send your invoice on Oct. An example of such an agreement is 1/10 Net 30. However, this may be illegal as an employer paying their staff, contractor or not. This phrase is essentially a shorthand for a payment policy that allows customers to receive a discount for paying their invoice within a certain timeframe. Here are the key takeaways on offering net 30 terms: Offering net 30 terms means you extend credit to you customers. Don’t spend money you don’t. Net 10, net 15, net 30 and net 60 (often hyphenated “net-” and/or followed by “days”, e. What does 2% net 30 days mean? 2/10 net 30 means buyers will receive a 2% discount if they pay the due amount within ten days. On the Terms dropdown, click New. A business that offers a 2/10 net 30 discount is expressing. For example, if you send an invoice dated on June 1st, your customer will have until July 1st to make the payment. (3. As a result, when you create a N/10 EOM, you must pay the invoice in full 10 days. Legally speaking, net 30 means that buyer will pay seller in full on or before the 30th calendar day of when the goods were dispatched by the seller or the services were fully provided. Firstly, 2/10, N/30 is referred to as 2/10 net/30. Net 7, 10, 15, 30, 60, or 90: Payment expected within 7, 10, 15, 30, 60, or 90 days. By definition, using Net 30 terms delays the flow of cash into your business. Yet that doesn’t really tell you how net-30 might help you to build commercial credit or why it can be a great choice of credit for new and old businesses alike. a purchase in transit for 7 days before receipt has just 23 additional days until payment is due to the. If you find yourself. What does 10 net 30 mean? The 1%/10 net 30 calculation is a way of providing cash discounts on purchases. Net 10, net 15, net 30 and net 60 (often hyphenated “net-” and/or followed by “days”, e. However, the net terms can vary depending on the seller and industry. 30 in the most comprehensive dictionary definitions resource on the web. Net 30, a term found on invoices, simply means a customer has 30 days from the invoice date to pay the bill in full. The "2/10" part of the term indicates that a 2% discount is available if the buyer pays the invoice within 10 days of the invoice date. Two-tenths of a percent discount for payment within 30 days. 2/10 Net 30 term explained. So, the total number of elements in the data set is 10. Otherwise, the total amount is due within 30 days. Net 30 : The invoice is due for payment by the customer within 30 days of the invoice date. Expands your customer base. 3/20 net 60: 3% early payment discount within 20 days, or the total amount of the invoice due in 60 days. 04% for the 20 days between day 10 and day 30. Answer: a) 2/10 net 30 means that buyers are eligible to get a 2% discount on trade credit if the amount due is paid within 10 days. The 1%/10 net 30 calculation is a way of providing cash discounts on purchases. This means that if the buyer is able to fulfill the invoice amount of the. It exemplifies a payment agreement between the business and customer, with specific expectations on both parties to ensure payment is made on time. But net 30 is not the only term you’ll run into. The "net 30" part of the term means that the buyer is expected to. Not all clients will understand what net 30 means, so it is important to make a note somewhere on the invoice to let first-time clients know what. After 10 days, the full amount of 800 is due within 30 days of the invoice date. In this case, net 30 means the vendor wants to be paid within 30 days from the invoice date. Calculated amount of the discount @2% $ 50. 2/10, n/30: The credit term of [ 2/10, n/30] means that you will get a discount of 2% if you clear your account within 10 days with a maximum credit period of 30 days. It is so standard across the business world that, for example, clients in the UK have a legal obligation to pay their suppliers within 30 days. 9 What do trade credit terms of 2/15 net 30 mean to a buyer?. Enter the name for the payment term and select Date Driven. In our example, the company must either pay $98,000 in 10 days or they must pay $100,000 by the 10th day after the end of the month. What Does It Mean on an Invoice? Net 30 is a term used to communicate that the recipient has 30 days to pay an invoice. , "net 10 days") are payment terms for trade credit,. c. In the United States, “net 30” is among the most widely used payment terms, referring to a 30-day period during which the customer must pay the full amount of their invoice. View the full answer. What does 1% 10, net 30, and Net60 mean? This is expressed as a notation like “1% 10, net 30” or “1/10 net 30. 50 Percent Upfront:What Is . On contracts and invoices, you’ll see these terms. e 1/10) otherwise, customer can choose to to pay at any time before expiry of 60 days. 2/10 Net 30 refers to the trade credit offered to a customer for the sale of goods or services. So, if the payment term is net 30 EOM, it means that the customer has 30 days to pay back, after the end of the month when the invoice was sent. 1/10 Net 30 means that the purchaser will receive at least a 1% discount if you get paid within 10 days of purchase. Net terms such as net 5,10 could be used for newer customers, while net 15, 30. To do that: Go to Lists from the menu bar and select Customer & Vendor Profile Lists. A vendor can change the payment terms according to when they want to be paid. One of the most common payment terms, Net 30 days (or “N/30″), means that a buyer must settle his or her account within 30 days of the date listed on the. The Nutrition Facts label on the product says it has 30 grams of total carbohydrates. Calculated amount of the discount @2% $ 50. This type of agreement is common in business-to-business transactions. This is where terms like “3% 10 Net 30” or “3/10 Net 30” come in. What does 2/10 net 30 mean in accounting?Indication "2/10, n/30" (or "2/10 net 30") on an invoice represents a cash (sales) discount provided by the seller to the buyer for prompt payment. What does it mean if a bond is trading at 92? it is trading at 92% of par value. Act fast for a 1% discount or pay within 30 days. For example, in some cases, net 30 means you have 30 days to pay from the date that the goods are delivered. It could mean 30 days after the sale, 30 days after delivery, or 30 days after the invoice. This is a standard payment term for many businesses, and it gives the buyer a month to gather the funds needed to pay the bill. A common reward for faster payments is to offer a discount when the invoice is paid in full by a specific date before the final due date. What does ‘3/10 net 30’ mean? Sometimes, net 30 invoice terms are coupled with a discount. NET? . End-of-month (EOM) terms operate differently: This type specifies that a payment is due after a set number of days once the month ends. Net 30 allows customers to pay early or anytime before the 30 days expire, but after that, the account becomes past due. What does 2 percent 2nd 10th net 30 payment terms mean? stupud. So a Net EOM 5 is. If you pay the bill within ten days of the invoice date, you will receive a 1% discount. . What a a 2/10 web 30 early auszahlen discount and when does it make sense by your business to use one? Read our full guide with examples and calculations. Business owners can expand their customer base by offering credit terms such as net 30. In any case, the total amount is due in 30 days or less. net dictionary. What does "2/10" mean, with respect to "credit terms of 2/10, n/30"? A. The chancellor said that for someone on the average. The second— 30 in this case. 2% discount allowed on payments made on or before. The term 2/10, n/30 is a typical credit term and means the following: "2" shows the discount percentage offered by the seller. Net 10, net 15, and net 30 all serve the same function on an invoice, with the exception of the length of time provided to pay the amount credited. It means that if the bill is paid within 10 days, there is a 1% discount. The term may be abbreviated to “n” instead of “net”. "2/10 net 30" is a commonly used payment term in business transactions. This means you, as the business, are offering your customer a short-term, 0% interest loan. Net 30 indicates that the full payment is due, at the latest, by 30 days from the invoice date. 2/10 net 60 and 1/10 net 60 mean the customer must pay the invoice within 10 days to receive a 2% or 1% discount, respectively, or pay the full invoice amount within 60 days. 3n10 net30 This is usually the way it's stated (or something similar) 2n10 net 30 means a 2 percent discount if paid within in ten days of the invoice date with full payment due in 30 days. 2 percent discount for payment within 10 days, or the full amount (less returns) due within 30 days. 980 12/8 (within the discount period) Accounts Payable 980 Cash 980 12/15 (without the discount period) Accounts Payable 980 Purchase Discount Lost 20 Cash. , Gross sales total $300,000, one-half of which. What does “3/10 net 30” mean? “3/10 net 30” means customers can receive a 3% discount if they pay within 10 days. ” It’s. What does net 2/10 30 mean? Like the net 3/10 30, net 2/10 30 is an early payment discount. - The notation "net30" indicates that full payment is expected within 30 days. This is not normal. When exactly does Net 30 start? The due date in net 30 terms can vary depending on the agreement between the client and your business. It indicates when the vendor wants to be paid for the service or product provided. Explanation: 1. EOM stands for the end of the month. . The client must pay 50 percent of the total invoice amount before. Net 45 payment terms: Invoice is due in 45 daysSimply put, 2/10 net 30 is a trade credit offered by the seller to the buyer for their purchase. Net worth is a concept applicable to individuals and businesses as a key measure of how much an entity is worth. Net 30 is a shorthand way to indicate on an invoice that payment is due 30 days from the invoice date. For example, giving a 2% discount to clients who settle their accounts within 10 days is quite common. The number after the net indicates the. Two employees working identical positions may have identical gross pay, but significantly different net pay. ($500/$490) – 1 = 2. A 2/10 net 30 means that the amount balance can be paid by a discount of 2% if the buyer pays within the first ten days. Net-30 terms means full payment is due 30 days after the invoice date. Here are examples of net 30 payment terms combined with discounted rates for early payment. Another common sales discount is "2% 10/Net 30" terms, which allows a 2% discount for paying within 10 days of the invoice. It represents an agreement that the buyer will receive a 2% discount on the net invoice amount if they pay within 10 days. The new payment terms would then be 2% 30, net 90. If you are purchasing goods, its usually combined with a discount. 2/10 Net 60 means that you will give credit to your clients up to a 2% discount if the order is made within 10. Once done, click OK. As an example, if the invoice amount is $500, calculate the 2/10 net 30 annualized interest rate: $500 x (100% – 2%) = $500 x 98% = $490. Here, N/10 denotes the net credit period of 10 days. Learn in detail about the concept and why it is crucial for business. what does 2/10, net 30 mean. , sells earnings forecasts for Japanese securities. If a $1,000 invoice dated 1 January has the terms “net 30”, the buyer must pay the full $1,000 within 30 days, which in this example falls on 30 January. Specifically, 800 Terms 1/10 Net 30 indicates that customers can receive a 10% discount on the invoice amount if they pay within 10 days, with the. 2%/10 days, Net 30 terms (2/10 Net 30) 2% discount if you pay within 10 days. For example: Johnny’s gross earnings for his lemonade stand were $25, and he only spent $7 on the lemonade and cups, so he was pleased with walking away with $18 at the end of the day. *. Just like 1/10 Net 30, with terms of 2/10, n/30, the “2” represents 2%, the “10”. A consistent increase. What does ‘3/10 net 30’ mean? Sometimes, net 30 invoice terms are coupled with a discount. 1 Percent of 10 NET 30 usage in. The . Take a look at this example to determine how. What is 2 10, N 30?Definition: 2 10, Net 30 is a cash discount term where customers have 30 days to pay for purchase but can receive a two percent discount i. On the other hand, if the customer pays after 10 days, he must pay the full amount of $10,000. Payment terms offered by a vendor are shown on a customer’s purchase order (PO) and invoice. What does 3/10 Net 30 mean? 3/10 Net 30 is the trade credit offered and if 3/10 is displayed, it means that there is 3% of discount is offered to the borrower if the balance is paid within 10 days from the date of receipt. 1/10 Net 30 means that the purchaser will receive at least a 1% discount if you get paid within 10 days of purchase. Just below the nutrition facts box, the "impact carb facts" box provided by the manufacturer explains, "Fiber. Net 10: Pay in 10 days: None: Net 30: Pay in 30 days: None: Net EOM 10: Pay within 10 days of month-end: None: 1/10 Net 30: Take 1% discount if pay in 10 days,. Suppliers or manufacturers often insert motivational discount terms to encourage the clients to pay early. It refers to a payment period, meaning the customer has a 30-day length of time to pay the total amount of their invoice. If FIN222 Ltd chooses to take the discount offered, it must obtain a bank loan to afford it. Unlock savings with 1%/10 Net 30! Discover how this billing term can boost your finances. Save them the headache by providing a brief and concise explanation next to. Net 30 is the payment period specified for a customer for the payment of an invoice issued for a transaction. Farwell Company purchased merchandise with an invoice price of $2,000 and credit terms of 1/10, n/30. There are different payment periods that a business might allow each customer depending on the profile credibility, cashflow or business process involved. Update April 11, 2023: Quill may not be currently reporting to business credit. Cash Discount: A cash discount is an incentive that a seller offers to a buyer in return for paying a bill owed before the scheduled due date. a. The purpose of this is to shorten accounts receivable cycles for those who provide credit terms. g. What is a 2/10 net 30 early payment discount and when does items make sense in your store to use on? Read unsere full guide with examples also calculations. What does 2% 10 mean in the payment terms 2% 10 Net 30? 2/10 net 30 is a trade credit offered by the seller to the buyer for their purchase. g. What does 2/10, n/30 Mean? 2/10, n/30 or 2/10, N 30 refer to the accounting term in which seller provides the cash discount to customers. Such an agreement or offer is written on an invoice as “2/10 net 30. g. Net 30 terms are often combined with a cash discount for early settlement. Similarly, 2/10 Net 30 means that the purchaser will receive a 2% discount if you get paid within 10 days of purchase. When a company offers Sales discounts with terms 2/10, n/30, it is broken down as follows, The 2 is the discount in percentage,The vendor's invoice shows the amount of $1,000 along with credit terms of 2/10, net 30 days. If the invoice is net 30, though, it indicates that while the payment is also due in 30 days, the customer can avail a discount if payment is made before then. This means the national insurance rate paid by 27 million people will drop from 12% to 10% from January. 2/10 Net 30 (2/10, n/30) means that the payment is still due in 30 days, but the customer will receive a 2% discount if the invoice is paid within 10 days. 2. A typical net 30 credit term means the balance is due within 30 days from the invoice date. PIA: Payment in advance. Definition of 1. For example, an invoice for. ” In this case, “net 30 payment” refers to the payment deadline, the first number (1) denotes the percentage discount, and the second number (10) indicates the period during which the discount is valid. It means thirty days after April 30. Variations: net 7, net 10, net 60, net 90. Otherwise, they forfeit the discount. Top Answer: It means that if the bill is paid within 10 days, there is a 2% discount. When does the net 60 term start? The due date of a net 60 invoice might be interpreted in a number of ways. As mentioned in the article, businesses can offer discounts so that their clients pay early. That’s a 36% return on cash for the discount. 2/10 Net 30 (2/10, n/30) means that the payment is still due in 30 days, but the customer will receive a 2% discount if the invoice is paid within 10 days. Both refer to due dates being in the following month rather than the current one. 15, payment would be due 30 days from Nov. What does the credit term 1/10 Net 60 mean? 1/10 Net 60. Subtotal invoice amount $ 2,500. Net 30 means a vendor expects a buyer to make full payment within 30 days of the invoice date. Check before you apply. What does $800 with terms 1 10 net 30 mean? An invoice for 800 with terms 1/10 net 30 is a business transaction that requires payment of 800 with a 1/10 discount if the payment is made within 10 days of the invoice date. Net 10, net 15, and net 30 all serve the same function on an invoice, with the exception of the length of time provided to pay the amount credited. Net 30 is also sometimes written as n/30 or 1/10 n/30, which means you can get a 1% discount if you pay within 10 days. 00 – $25. This is the early payment discount portion of the term, “1/10 net 30”. Importance of Net 45 Net 45 is an important credit term because it allows customers to pay 15 days later than the more common payment terms of net 30. Definition of Net 30. borrow it 10 million dollars at 5% but, we'll get into. What does $800 with terms 1 10 net 30 mean? An invoice for 800 with terms 1/10 net 30 is a business transaction that requires payment of 800 with a 1/10 discount if the payment is made within 10 days of the invoice date. e. 98 = $9,800. On an invoice, net 10 means that full payment is due in 10 days after the invoice date, at the very latest. From an accounting manual for a university - with many definitions for various payment terms I found this: 2% 10 and 25th =. If a customer makes payment within 10 days to pay, they will get a 1% discount. For example, if your client’s invoice date is May 1 with net 30 terms, payment would be due on May 31. With a net-30 invoice, the client has to pay within 30 days or less. Technically, the seller is lending the buyer money. You do this by combining all of your expenses during this time (cost of goods, other expenses, taxes, and debt) subtracting them from your total income that. To illustrate, for example 2% 10 days, net 30 terms or 2/10, n/30 means, that a 2%. Net 30 means that the full payment is due within 30 days of the invoice issue date. Select Customer & Vendor Profile Lists. The Disadvantages of Net 30. Like Net 30 invoice terms, 2/10 Net 30 requires buyers to pay within no more than 30 days of receipt. The seller will usually reduce the amount owed by the. Similarly, 2/10 Net 30 means that the purchaser will receive a 2% discount if you get paid within 10 days of purchase. Net-net is a value investing technique developed by Benjamin Graham in which a company is valued based solely on its net current assets. Simply put, net 30 on an invoice means payment is due thirty days after the date. Benefits of a Net 30 Account Net 30 is a term included in the payment terms on an invoice. Understanding 2/10 Net 30. g. Net due upon receipt; Net 30 days (which means the amount owed is due in 30 days) 1/10, n/30 (which means 1% can be deducted from the amount owed if paid within 10 days instead of the required 30 days) 2/10, n/30 (which means 2% can be deducted from the amount owed if paid within 10 days instead of the required 30 days). What does 10 mean? Information and translations of 10 in the most comprehensive dictionary definitions resource on the web. 00 NNN ($6. Net 15 means that a customer has 15 calendar days to submit payment for the invoice. $900: 2/10, n/30: If paid within 10 days of the invoice date, the buyer may deduct 2% from the net amount. So. What does 30 day nett terms mean? 30-day net terms means this is the amount of time a business has to pay an invoice. While net 30 always means within 30 days, when the clock starts ticking is up to you. A supplier offers a firm a 4/10, net 30 discount for early payment on a $1500 bill. This is illustrated by such terms as "1/10, net 30" of "2/10, net 60. A net 30 account is a line of credit that vendors extend to their customers. NET 30 terminology is for invoicing. The phrase Net 30 prox is used in the accounting field. The phrase “Net 10th Prox” means that payment for goods or services received is due on or before the 10th of the following month. Learn more. g. company does in fact decide to exercise its option to draw down cash from its . Other common net terms include net 60 for 60 days and net 90 for 90 days. Previous question Next question. Thus, terms of “1/10 NET 30” mean that a discount of 1% can be taken if payment is made within 10 days. Most small businesses use net 30 as their standard credit term. Meaning of -30-. “Net 30” refers to a payment term that means a customer has a 30-day length of time (or payment period) from when they received the invoice to pay their full invoice balance. Editing documents is now an integral part of many working processes in various professional areas, which explains why accessibility and efficiency are crucial for editing instruments. Other common net terms include net 60 for 60 days and net 90 for 90 days. net dictionary. Several of our suppliers are offering Payment terms that use the following Concept of 10th-25th prox. The terms 2/10, net/30 mean that a 2 percent discount is allowed on payments made within the 10 days discount period. A vendor can change the payment terms according to when they want to be paid. The "1%/10" part of the payment terms means that if the bill is paid within 10 days of the invoice date, the customer will receive a 1% discount on the total amount due. Below are a few important steps to take in order to start implementing net terms (including Net 30) in your. Here are examples of net 30 payment terms combined with discounted rates for early payment. This simply shows the number of days that the recipient has before invoice payment is due. If the invoice isn’t paid within 10 days, it’s due in 30 days with no discount. 2/10 Net 30 . What does ‘3/10 net 30’ mean? Sometimes, net 30 invoice terms are coupled with a discount. Other net terms examples might include net 10 for 10 days, net 60 for 60 days, etc. Net terms can vary and include a discount for quick payments (for example 5% 10, net 30). What does 'net zero' mean? Net zero means no longer adding to the total amount of greenhouse gases in the atmosphere. This option offers even more payment flexibility for your clients. This discount is 2% of the total balance and only applies if the customer pays the invoice in 10 days. ”. The 1%/10 net 30 calculation is a way of providing cash discounts on purchases. M stands for ‘End of Month. . Net 30 terms are often used when the supplier offers a discount for early payment (such as 2% 10 Net 30). Net 15 means you have to pay an invoice in 15 days. 5, 9. For example, a net 30 invoice dated “April 1” would be due April 30. one of the most popular payment terms is “net 30. The "1%/10" part of the payment terms means that if the bill is. What does -30- mean? Information and translations of -30- in the most comprehensive dictionary definitions resource on the web. 1/15 Net 30: This means the customer receives a 1% discount if payment is received within 15 days. It means that the buyer must pay the full amount of an invoice within 30 days, but they may receive a 1 percent discount if they pay within 10 days. Net Cost Method 12/ 1 Inventory . . Here’s the net 30 meaning: It’s when a seller extends a buyer 30 calendar days to pay the full amount for goods provided or services rendered. Net 30 indicates that the full payment is due, at the latest, by 30 days from the invoice date. "10" indicates the number of days (from the invoice date) within which. Everything has a downside and so does 2/10 net 30 terms too. Most businesses avoid purchases using this term. This guide examines what is a net 30 account for a business, the pros and cons of net 30 accounts, how to open a net 30 account and how it all fits your business’s needs. Net 60 payment terms. Two payment term abbreviations used with reference to due dates are prox and EOM. 3/10 net 30 means a 3% discount if a customer pays within 10 days. If the customer doesn’t take the early payment discount, the invoice is due for payment within 30 days. Net 30 refers to the amount owed in full, less any discounts and deductions. It means that if the bill is paid within 10 days, there is a 1% discount. Net 30 refers to a payment term where the payment for the goods or services is due in full 30 days after the transaction has completed. If MetroPulse Media receives an invoice for purchases dated 10/21/X5 subject to credit terms of "3/10, net 30 EOM, Top Answer: My answer is Option C. net 30 meaning: written on an invoice to show that it must be paid within 30 days. The 2/10 Net 30 is a popular method of extending trade credits to buyers. 1/10. This video covers the definition of 1%/10 Net 30 along with some useful information to help you understand this business term. Question: Question 4 (10 marks) a) What does the term ‘2/10, net 30’ mean? (1. A net 30 account is a line of credit that vendors extend to their customers. 5 marks) b) Explain how a negative cash conversion cycle arises. The 1%/10 net 30 calculation is a way of providing cash discounts on purchases.