API Docs
API Docs
  1. Special Features
  • Getting Started
    • Introduction to Sales Tax Calculation
    • Step By Step - Creating your first transaction
    • Step By Step - Creating VAT / Global Tax Transaction
  • Endpoints
    • Authentication
      • Authentication - Getting Started
      • Create JWT
    • Customers
      • Get to Know
      • Get Customer
      • Get All Customers
      • Upsert Customer
      • Update Customer
    • Exemptions
      • Get to Know
      • Get All Exemptions
      • Post Exemption
      • Update Exemption
      • Patch Exemption
    • Transactions
      • Get to Know
      • The Importance of Shipping Address
      • How to Use Credit Memos
      • Get Transaction (thin)
      • Get Transaction
      • Upsert Transaction
      • Delete Transaction
      • Get All Transactions (thin)
      • Get All Transactions
      • Upsert VAT / GT Transactio
    • Address Validation
      • Address Validation Intro
      • Validate Address
    • Sales Tax Rates
      • Get Sales Tax Rates
    • Vat Validation
      • Validate Vat
  • Special Features
    • Global Tax Rate
    • Partial Address
    • Discounts
    • Inclusive Tax
    • Vat Validation
    • Post exemptions from CSV
      POST
  • Applications
    • Xero - Integration & User Manual
  1. Special Features

Discounts

Understanding Discounts#

This guide explains the concept of discounts, how they affect sales prices, and provides a clear example to illustrate their application. This ensures that discounts are accurately applied, giving customers a clear understanding of the savings they receive.

What is a Discount?#

A discount is a reduction applied to the original sales price of a product or service. In our case, the discount can be offered on an item or the whole transaction as a fixed amount, reducing the total amount that the customer needs to pay.

How Discounts Work?#

Several key aspects determine the application of discounts:
Original Sales Price: The initial price of the product or service before any discount is applied.
Discount Amount/Rate: The fixed amount or rate of reduction applied to the original sales price.
Final Sales Price: The amount the customer pays after the discount is subtracted from the original sales price.

Example Calculation:#

Original Transaction-#
Item1 Price: $70
Item2 Price: $30
Original Total Transaction Price: $100
Discount Amount: $10 (Discount Rate: 10%)
Transaction After Discount-#
Item1 Price After Discount: $70 - (Item1 Price * Discount Rate) => $63
Item2 Price After Discount: $30 - (Item2 Price * Discount Rate) => $27
Total Amount Due: $100 - (Discount Amount) => $90
Therefore, with a discount amount of $10, we calculate the rate from the whole sales price, which is 10% and reduce 10% from each item price.
The discount amount on a $100 sales price is $10, leaving $90 as the final sales price.

Steps to Calculate:#

1.
Identify the Original Sales Price:
Determine the initial price of the transaction.
2.
Calculate the Discount rate:
Use the formula to determine the discount rate based on the original sales price and the discount amount.
3.
Reduce the Relative Discount from the items:
Use the formula to reduce the price of each item by applying the relative discount on the items.
4.
Determine the Final Sales Price:
Subtract the calculated discount amount from the original sales price to get the final sales price.
Modified at 2024-07-25 12:42:05
Previous
Partial Address
Next
Inclusive Tax
Built with