what is 1 10 net 30 
the 1 10 net 30 calculation is a way of providing cash discounts on purchases it means that if the bill is paid within 10 days there is a 1 discount otherwise the total amount is due within 30 days understanding 1 10 net 30the 1 10 net 30 calculation represents the credit terms and payment requirements outlined by a seller the vendor may offer incentives to pay early to accelerate the inflow of cash this is particularly important for cash strapped businesses or companies with no revolving lines of credit companies with higher profit margins are more likely to offer cash discounts although the numbers are always interchangeable across vendors the standard structure for offering a payment discount is the same the first number will always be the percentage discount this figure will indicate the total percentage discount on the invoice prior to shipping or taxes that may be discounted upon early payment special considerationsdiscount terms like 1 10 net 30 are virtual short term loans this is because if the discount is not taken the buyer must pay the higher price as opposed to paying a reduced cost in effect the difference between these two prices reflects the discount lost which can be reported as a percentage this percentage is called the cost of credit 